College Accounting (Book Only): A Career Approach
College Accounting (Book Only): A Career Approach
13th Edition
ISBN: 9781337280570
Author: Scott, Cathy J.
Publisher: South-Western College Pub
Question
Chapter 8, Problem 2PA

1.

To determine

Complete the Company A’s payroll register.

2.

To determine

Prepare journal entry to record the payroll as of December 7.

3.

To determine

Prepare journal entry to record the payroll taxes as of December 7.

4.

To determine

Prepare journal entry to record the payroll as of December 9 by assuming that the company has transferred cash to the cash-payroll bank account.

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  • For tax purposes, assume that the maximum taxable earnings are 118,500 for Social Security and 7,000 for the unemployment tax and that all earnings are taxable for Medicare. For the payroll register for the month of November for Shelby, Inc., determine the taxable earnings for each employee.
    Payrex Co. has six employees. All are paid on a weekly basis. For the payroll period ending January 7, total employee earnings were 12,500, all of which were subject to SUTA, FUTA, Social Security, and Medicare taxes. The SUTA tax rate in Payrexs state is 5.4%, but Payrex qualifies for a rate of 2.0% because of its good record of providing regular employment to its employees. Other employer payroll taxes are at the rates described in the chapter. REQUIRED 1. Calculate Payrexs FUTA, SUTA, Social Security, and Medicare taxes for the week ended January 7. 2. Prepare the journal entry for Payrexs payroll taxes for the week ended January 7. 3. What amount of payroll taxes did Payrex save because of its good employment record?
    Wallace Corporation summarizes the following information from its weekly payroll records during April. Prepare the two journal entries to record the payment of the payroll and the accrual of its payroll taxes for April. Assume an 8% FICA rate for both employees and the employer. Also assume a 5.4% state unemployment tax rate, a 0.6% federal unemployment tax rate, and that all wages are subject to all payroll taxes. Round to the nearest dollar.
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