BuyFindarrow_forward

Accounting

27th Edition
WARREN + 5 others
ISBN: 9781337272094

Solutions

Chapter
Section
BuyFindarrow_forward

Accounting

27th Edition
WARREN + 5 others
ISBN: 9781337272094
Textbook Problem

Journalize payroll tax

The payroll register of Ruggerio Co, indicates $10,500 of social security withheld and $2,625 of medicare tax withheld on total salaries of $175,000 for the period. Earnings of $30,000 are subject to state and federal unemployment compensation taxes at the federal rate of 0.6% and the state rate of 5.4%.

Provide the journal entry to record the payroll tax expense for the period.

To determine

Employer payroll taxes: The taxes which the employer must pay to the employees with their salaries are called employer payroll taxes. Such taxes are not withheld from employees’ gross earnings but instead they are paid by employer.

To Journalize: The payroll taxes expense for the period.

Explanation

Working notes:

Calculate the amount of Federal unemployment taxes payable as below:

Federal Unemployment taxes payable=$30,000×0.6%=$180 (1)

Calculate the amount of State unemployment taxes payable as below:

State Unemployment taxes payable=$30,000×5.4%=$1,620 (2)

Calculate the amount of payroll tax expense as below:

Payroll tax expense=(Social security Taxes Payable )+ (Medicare Taxes Payable) +(Federal Unemployment Taxes Payable) + (State Unemployment 

Still sussing out bartleby?

Check out a sample textbook solution.

See a sample solution

The Solution to Your Study Problems

Bartleby provides explanations to thousands of textbook problems written by our experts, many with advanced degrees!

Get Started

Additional Business Solutions

Find more solutions based on key concepts

Show solutions add

What is the purpose of the strategic IT plan?

Accounting Information Systems

What is meant by business ethics?

Foundations of Business (MindTap Course List)

Give three examples of important trade-offs that you face in your life.

Principles of Microeconomics (MindTap Course List)

Why do economists oppose policies that restrict trade among nations?

Brief Principles of Macroeconomics (MindTap Course List)

Distinguish between contributory and noncontributory pension plans.

Intermediate Accounting: Reporting And Analysis

CASH BUDGETING Helen Bowers, owner of Helens Fashion Designs, is planning to request a line of credit from her ...

Fundamentals of Financial Management, Concise Edition (with Thomson ONE - Business School Edition, 1 term (6 months) Printed Access Card) (MindTap Course List)