Question

Payroll Taxes Kinsella, Inc., has a gross payroll of $24,000 for the pay period. Kinsella must also withhold $2,900 in federal income taxes from the employees and pay state unemployment taxes of $72. Assume the entire payroll is eligible for Social Security and Medicare at standard rates.

Required: Prepare the necessary journal entries for Kinsella to record both the gross pay earned by employees and the employer portion of these payroll taxes. If an amount box does not require an entry, leave it blank. If required, round amounts to the nearest dollar.

Wages Expense

Federal Income Taxes Withholding Payable

Social Security Taxes Payable (Employee)

Medicare Taxes Payable (Employee)

Cash (Record wages and liabilities)

State Unemployment Taxes Expense Social Security Taxes Expense (Employer)

Medicare Taxes Expense (Employer)

State Unemployment Taxes Payable Social Security Taxes Payable (Employer)

Medicare Taxes Payable (Employer)

(Record employer payroll taxes)

Answer 1

Wages Expense	24000
Federal Income Taxes Withholding Payable		2900
Social Security Taxes Payable (Employee)		1488	=24000*6.2%
Medicare Taxes Payable (Employee)		348	=24000*1.45%
Cash		19264
(Record wages and liabilities)
State Unemployment Taxes Expense	72
Social Security Taxes Expense (Employer)	1488		=24000*6.2%
Medicare Taxes Expense (Employer)	348		=24000*1.45%
State Unemployment Taxes Payable		72
Social Security Taxes Payable (Employer)		1488
Medicare Taxes Payable (Employer)		348
(Record employer payroll taxes)