Question

Payroll Entries

Widmer Company had gross wages of $180,000 during the week ended June 17. The amount of wages subject to social security tax was $162,000, while the amount of wages subject to federal and state unemployment taxes was $23,000. Tax rates are as follows:

Social security6.0%

Medicare1.5%

State unemployment5.4%

Federal unemployment0.8%

The total amount withheld from employee wages for federal taxes was $36,000.

If an amount box does not require an entry, leave it blank. If required, round answers to two decimal places.

a. Journalize the entry to record the payroll for the week of June 17.

June 7

b. Journalize the entry to record the payroll tax expense incurred for the week of June 17.

June 7

Answer 1

a
June 7	Wages expense	180000
	Social Security tax payable		9720	=162000*6%
	Medicare tax payable		2430	=162000*1.5%
	Employees Federal tax payable		36000
	Wages payable		131850
b
June 7	Payroll tax expense	13576
	Social Security tax payable		9720
	Medicare tax payable		2430
	State Unemployment tax payable		1242	=23000*5.4%
	Federal Unemployment tax payable		184	=23000*0.8%