The payroll of Ivanhoe Company for September 2019 is as follows. Total payroll was $468,000, of which $104,000 is exempt from Social Security tax because it represented amounts paid in excess of $128,400 to certain employees. The amount paid to employees in excess of $7,000 (the maximum for both federal and state unemployment tax) was $406,000. Income taxes in the amount of $76,500 were withheld, as was $9,800 in union dues. The state unemployment tax is 3.5%, but Ivanhoe Company is allowed a credit of 2.3% by the state for its unemployment experience. Also, assume that the current FICA tax is 7.65% on an employee's wages to $128,400 and 1.45% in excess of $128,400. No employee for Ivanhoe makes more than $135,000. The federal unemployment tax rate is 0.8% after state credit. Prepare the necessary journal entries if the wages and salaries paid and the employer payroll taxes are recorded separately. (Round answers to 0 decimal places, e.g. 5,275. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts .Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit
The payroll of Ivanhoe Company for September 2019 is as follows. Total payroll was $468,000, of which $104,000 is exempt from Social Security tax because it represented amounts paid in excess of $128,400 to certain employees. The amount paid to employees in excess of $7,000 (the maximum for both federal and state unemployment tax) was $406,000. Income taxes in the amount of $76,500 were withheld, as was $9,800 in union dues. The state unemployment tax is 3.5%, but Ivanhoe Company is allowed a credit of 2.3% by the state for its unemployment experience. Also, assume that the current FICA tax is 7.65% on an employee's wages to $128,400 and 1.45% in excess of $128,400. No employee for Ivanhoe makes more than $135,000. The federal unemployment tax rate is 0.8% after state credit. Prepare the necessary journal entries if the wages and salaries paid and the employer payroll taxes are recorded separately. (Round answers to 0 decimal places, e.g. 5,275. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts .Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit
College Accounting (Book Only): A Career Approach
13th Edition
ISBN:9781337280570
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Publisher:Scott, Cathy J.
Chapter7: Employee Earnings And Deductions
Section: Chapter Questions
Problem 6E: On January 21, the column totals of the payroll register for Great Products Company showed that its...
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![The payroll of Ivanhoe Company for September 2019 is as follows.
Total payroll was $468,000, of which $104,000 is exempt from Social Security tax because it represented amounts paid in excess of
$128,400 to certain employees. The amount paid to employees in excess of $7,000 (the maximum for both federal and state
unemployment tax) was $406,000. Income taxes in the amount of $76,500 were withheld, as was $9,800 in union dues. The state
unemployment tax is 3.5%, but Ivanhoe Company is allowed a credit of 2.3% by the state for its unemployment experience. Also,
assume that the current FICA tax is 7.65% on an employee's wages to $128,400 and 1.45% in excess of $128,400. No employee for
Ivanhoe makes more than $135,000. The federal unemployment tax rate is 0.8% after state credit.
Prepare the necessary journal entries if the wages and salaries paid and the employer payroll taxes are recorded separately. (Round
answers to 0 decimal places, e.g. 5,275. If no entry is required, select "No Entry" for the account titles and enter O for the
amounts .Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Account Titles and Explanation
(To record wages and salaries paid)
Debit
Credit](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2d5f1d1f-780d-45ad-b52a-ed79b25cb346%2Fe70a93a3-0e19-4a41-9071-32e71ec6a21e%2Facdkdql_processed.jpeg&w=3840&q=75)
Transcribed Image Text:The payroll of Ivanhoe Company for September 2019 is as follows.
Total payroll was $468,000, of which $104,000 is exempt from Social Security tax because it represented amounts paid in excess of
$128,400 to certain employees. The amount paid to employees in excess of $7,000 (the maximum for both federal and state
unemployment tax) was $406,000. Income taxes in the amount of $76,500 were withheld, as was $9,800 in union dues. The state
unemployment tax is 3.5%, but Ivanhoe Company is allowed a credit of 2.3% by the state for its unemployment experience. Also,
assume that the current FICA tax is 7.65% on an employee's wages to $128,400 and 1.45% in excess of $128,400. No employee for
Ivanhoe makes more than $135,000. The federal unemployment tax rate is 0.8% after state credit.
Prepare the necessary journal entries if the wages and salaries paid and the employer payroll taxes are recorded separately. (Round
answers to 0 decimal places, e.g. 5,275. If no entry is required, select "No Entry" for the account titles and enter O for the
amounts .Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Account Titles and Explanation
(To record wages and salaries paid)
Debit
Credit
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