Question

It is August 2020. You are calculating the monthly paycheck, including employee withholding, and employer payroll...

It is August 2020. You are calculating the monthly paycheck, including employee withholding, and employer payroll related expenses for Bonnie Bigwig. Her pay through July is $110,000. Her August gross pay $20,000. Her Federal income tax withholding is at the 25% rate, her state withholding is at the 5% rate. (Ignore local income tax.) Her health insurance (all paid by the company) is $1,500 / month. She contributes $1,000 / month to the United Way.

Give the journal entry to pay Bonnie. Also, give the journal entry to record the employer payroll related expenses.

Have solutions written out below as actual journal entries within a table.

Payroll entries :

In general, Payroll entries are the entries which records the compensation paid to the employees.

JOURNAL ENTRY FOR PAYROLL EXPENSES:

1. Accrued payroll entry

Direct labor expense

Salary expense account (current month salary)

To Accrued salary account (gross salary)

To Accrued payroll taxes (Here, it is ignored)

2. Salary paid to employee

Accrued salary account

To cash account

A. JOURNAL ENTRY TO PAY BONNIE : (DEBIT AMOUNT) (CREDIT AMOUNT)

Accrued salary account    $130500       -

To cash account    -       $130500

B. JOURNAL ENTRY FOR PAYROLL EXPENSES :

Health insurance expense account   $1500       -

Salary expense account ($110000 + $20000)    $130000       -

To contribution - $1000

To Accrued salary account   -       $130500

NOTE :

Bonnie contributes $1000/ month to the United way. The contribution should be deducted from the salary.

Homework Answers

Answer #1

sol:

Payroll entries :

In general, Payroll entries unit the entries that records the compensation paid to the staff.

JOURNAL ENTRY FOR PAYROLL EXPENSES:

1. accumulated payroll entry

Direct labor expense

Salary account (current month salary)

To accumulated pay account (gross salary)

To accumulated payroll taxes (Here, it's ignored)

2. pay paid to employee

accumulated pay account

To account

A. JOURNAL ENTRY TO PAY truthful : (DEBIT AMOUNT) (CREDIT AMOUNT)

Accrued pay account $130500 -

To account - $130500

B. JOURNAL ENTRY FOR PAYROLL EXPENSES :

Health insurance account $1500 -

Salary account ($110000 + $20000) $130000 -

To contribution - $1000

To accumulated pay account - $130500

please upvote ,comment incase any doubt , feel free to comment ,thank you

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
BMX Company has one employee. FICA Social Security taxes are 6.2% of the first $128,400 paid...
BMX Company has one employee. FICA Social Security taxes are 6.2% of the first $128,400 paid to its employee, and FICA Medicare taxes are 1.45% of gross pay. For BMX, its FUTA taxes are 0.6% and SUTA taxes are 5.4% of the first $7,000 paid to its employee. Gross Pay through August 31 Gross Pay for September a. $ 6,400 $ 800 b. 2,000 2,100 c. 122,100 8,000 Assuming situation (a), prepare the employer’s September 30 journal entries to record...
prepate journal entries for the following AS OF MARCH 2017 1)Paid $5,000 to employees, with withholding...
prepate journal entries for the following AS OF MARCH 2017 1)Paid $5,000 to employees, with withholding of $960 for federal income taxes, $150 for state income taxes, $310 for social security, $725 for Medicare tax, and $100 for city income tax. Use Employee Tax Withheld account for all withholding. 2)Accrue employer tax (related to July 18th payroll) of $1,352. These taxes include employer portion of FICA and Medicare tax and state and federal unemployment tax. Use Employer Tax Payable account....
Payroll Taxes Kinsella, Inc., has a gross payroll of $24,000 for the pay period. Kinsella must...
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...
15. Airline Temporary Services (ATS) pays employees monthly. Payroll information is listed below for January, the...
15. Airline Temporary Services (ATS) pays employees monthly. Payroll information is listed below for January, the first month of ATS’s fiscal year. Assume that none of the employees exceeds the federal unemployment tax maximum salary of $7,000 in January.    Salaries expense $580,000       Federal and state income tax withheld 116,000       Federal unemployment tax rate 0.8 %   State unemployment tax rate (after FUTA deduction) 5.4 %   Social security (FICA) tax rate 7.65 %    Required: Record salaries expense and...
The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $560,000; Office...
The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $560,000; Office salaries, $112,000; Federal income taxes withheld, $168,000; State income taxes withheld, $37,500; Social security taxes withheld, $41,664; Medicare taxes withheld, $9,744; Medical insurance premiums, $13,500; Life insurance premiums, $10,500; Union dues deducted, $7,500; and Salaries subject to unemployment taxes, $63,000. The employee pays 40% of medical and life insurance premiums. Assume that FICA taxes are identical to those on employees and that SUTA taxes...
Required information Use the following information for the Exercises below. [The following information applies to the...
Required information Use the following information for the Exercises below. [The following information applies to the questions displayed below.] BMX Company has one employee. FICA Social Security taxes are 6.2% of the first $128,400 paid to its employee, and FICA Medicare taxes are 1.45% of gross pay. For BMX, its FUTA taxes are 0.6% and SUTA taxes are 5.4% of the first $7,000 paid to its employee. Gross Pay through August 31 Gross Pay for September a. $ 6,400 $...
[The following information applies to the questions displayed below.] BMX Company has one employee. FICA Social...
[The following information applies to the questions displayed below.] BMX Company has one employee. FICA Social Security taxes are 6.2% of the first $118,500 paid to its employee, and FICA Medicare taxes are 1.45% of gross pay. For BMX, its FUTA taxes are 0.6% and SUTA taxes are 2.9% of the first $7,000 paid to its employee. Gross Pay through August Gross Pay for September a. $ 6,400 $ 800 b. 18,200 2,100 c. 112,200 8,000 Assuming situation a, prepare...
1. Meg’s employer carries insurance on its employees that will pay an employee his or her...
1. Meg’s employer carries insurance on its employees that will pay an employee his or her regular salary while the employee is away from work due to illness. The premiums for Meg’s coverage were $1,800. Meg was absent from work for two months as a result of a kidney infection. Her employer’s insurance company paid Meg's regular salary of $8,000 while she was away from work. Meg also collected $2,000 on a wage continuation policy she had purchased. Meg must...
Compute the following for the week ended August 25. (Round your intermediate calculations and final answers...
Compute the following for the week ended August 25. (Round your intermediate calculations and final answers to 2 decimal places.): Paloma Co. has four employees. FICA Social Security taxes are 6.2% of the first $118,500 paid to each employee, and FICA Medicare taxes are 1.45% of gross pay. Also, for the first $7,000 paid to each employee, the company’s FUTA taxes are 0.6% and SUTA taxes are 2.15%. The company is preparing its payroll calculations for the week ended August...
Caribbean Tours' total payroll for the month of January was $590,000. The following withholdings, fringe benefits,...
Caribbean Tours' total payroll for the month of January was $590,000. The following withholdings, fringe benefits, and payroll taxes apply:       Federal and state income tax withheld $ 59,000         Health insurance premiums paid by employer (payable to Blue Cross) 10,620         Contribution to retirement plan paid by employer (payable to Fidelity) 23,600         FICA tax rate (Social Security and Medicare) 7.65 %   Federal and state unemployment tax rate 6.20 %    Assume that none of the withholdings or payroll...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT