Question

1. Calculate the employer's payroll taxes expense. Round your answer to the nearest cent.

2. Prepare the journal entry to record the employer's payroll taxes expense for the week ended June 21 of the current year. Round your answers to the nearest cent. If an amount box does not require an entry, leave it blank.

Portions of the payroll register for Kathy's Cupcakes for the week ended June 21 are shown below. The SUTA tax rate is 5.4%, and the FUTA tax rate is 0.6%, both on the first $7,000 of earnings. The Social Security tax rate is 6.2% on the first $118,500 of earnings. The Medicare rate is 1.45% on gross earnings.

Kathy's Cupcakes Payroll Register
	Total Taxable Earnings of All Employees
Total Earnings	Unemployment Compensation	Social Security
$15,860	$12,460	$15,860

Answer 1

1
Social Security Tax	983.32	=15860*6.2%
Medicare Tax	229.97	=15860*1.45%
FUTA Tax	74.76	=12460*0.6%
SUTA Tax	672.84	=12460*5.4%
Employer's payroll taxes expense.	1960.89
2
21-Jun	Debit	Credit
Payroll Taxes Expense	1960.89
Social Security Tax Payable		983.32
Medicare Tax Payable		229.97
FUTA Tax Payable		74.76
SUTA Tax Payable		672.84