David & Co. pays its employee twice a month. Employee earnings and tax amounts for the pay period ending December 31st are:
Instructions:
1. Prepare the general journal records for the payment of the payroll.
2. Post the payroll transaction to the general ledger.
3. Compute the payroll tax expense forms and journalize the entry to record the employer's payroll taxes using these rates:
a. Social Security, 6.2%
b. State Unemployment, 2%
c. Medicare, 1.45%
d. Federal unemployment, 0.8%
e. No employee has reached the taxable earnings limit
4. Post the entry to the general journal.
5. Journalize and post the entries for the payment of payroll liabilities.
6. Analyze and calculate the employer's total payroll-related expense for the pay period.