Chapter 9, Problem 4CE

### College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756

Chapter
Section

### College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756
Textbook Problem

# LC Co. estimates that its total payroll for the year will be $260,000. LC’s workers’ compensation insurance premium rate is 0.22%. Calculate LC’s estimated workers’ compensation insurance premium and prepare the journal entry for the payment of this amount.The answers to the Self-Study Test Questions are at the end of the chapter (pages 351–352). To determine Calculate Person LC’s estimated workers’ compensation insurance premium and prepare the journal entry for the payment of this amount. Explanation Workmenâ€™s compensation insurance: Workmenâ€™s compensation insurance is provided to employees as a compensation for the illness or injury suffered by them during the work. The employer pays the full Workmenâ€™s compensation insurance amount to the workers. Calculate the estimated workersâ€™ compensation insurance premium. Workmen'sÂ CompensationÂ InsuranceÂ ExpenseÂ }=(TotalÂ payrollÂ forÂ theÂ comingÂ year)Ã—(Workmen'sÂ CompensationÂ InsuranceÂ premiumÂ rateÂ )=$260,000Ã—0.22%=$572 Therefore, the estimated workersâ€™ compensation insurance premium is$572

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