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College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570

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BuyFindarrow_forward

College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570
Textbook Problem

Jack’s Lawn Service Company has the following information related to its current year payroll as of December 31:

  1. a. Federal Unemployment Tax Payable as of December 31, $336.00
  2. b. FUTA taxable earnings limit of $7,000, rate 0.6 percent (0.006)
  3. c. First-quarter FUTA taxable liability, $504.00, paid April 30
  4. d. Second-quarter FUTA taxable liability, $168.00 (liability under $500, no payment made)
  5. e. Third-quarter FUTA taxable liability, $112.00 (total liability under $500, no payment made)
  6. f. Fourth-quarter FUTA taxable liability, $56.00 (payment to be made January of the following year)
  7. g. FUTA taxable earnings for the year, $140,000
  8. h. Total Lawn Care Wages, $310,000
  9. i. Jack’s Lawn Service Company EIN, 75-1209347
  10. j. No exempt FUTA payments
  11. k. Address: 1515 W. Main Street, Rice, TX 75155

Required

Go to www.irs.gov to locate Form 940. Prepare Form 940 for the year. Then record the appropriate FUTA payment entry in the journal.

To determine

Complete the Form 940 for the year and journalize the appropriate FUTA payment entry.

Explanation

Form 940: Form 940 is used to report the employer’s federal unemployment tax liability and the payments during the particular calendar year. This from is prepared one in a year with a due date on January 31 following the close of the calendar year.

Complete the Form 940 for the year:

(Figure 1)

(Figure 2)

Journalize the appropriate FUTA payment entry.

DateAccount Title and explanationDebit ($)Credit (�...

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