The following information about the payroll for the week ended March 17 obtained from the records of Butte Mining CO: Salaries:
Sales salaries $244,000 Deductions:
Warehouse salaries $135,000 Income tax withheld $88,704
Office salaries $125,000 U.S Saving bonds $11,088
Total $504,000 Group insurance $9,072
Tax rate assumed
FICA tax, 7.5% of employee annual earnings
State unemployment (employer only), 4.2%
Federal unemployment (employer only), 0.8%
1Illustrate the effect on the accounts and financial statement of paying and recording the March 17 payroll Illustrate the effect on the accounts and financial statements of recording the liability for the March 17 payroll taxes.