The following information about the payroll for the week ended December 30 was obtained from the records of Arnsparger Equipment Co.:
Salaries: Deductions:
Sales salaries $244,000 Income tax withheld $ 88,704
Warehouse salaries 135,000 Social security tax withheld 27,216
Office salaries 125,000 Medicare tax withheld 7,560
$504,000 U.S. savings bonds 11,088
Group insurance 9,072 9,072 $ 143,640
Tax rates assumed:
Social security, 6% on first $100,000 of employee annual earnings
Medicare, 1.5%
State unemployment (employer only), 4.2%
Federal unemployment (employer only), 0.8%
Instructions
1. Assuming that the payroll for the last week of the year is to be paid on December 31, journalize the following entries:
a. December 30, to record the payroll.
b. December 30, to record the employer's payroll taxes on the payroll to be paid on December 31. Of the total payroll for the last week of the year, $25,000 is subject to unemployment compensation taxes.
2. Assuming that the payroll for the last week of the year is to be paid on January 5 of the following fiscal year, journalize the following entries:
a. December 30, to record the payroll.
b. January 5, to record the employer's payroll taxes on the payroll to be paid on January 5