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.