Lightning Electronics is a midsize manufacturer of lithium batteries. The company's payroll records for the November 1-14 pay period show that employees earned wages totaling $50,000 but that employee income taxes totaling $7,000 and FICA taxes totaling $2,625 were withheld from this amount. The net pay was directly deposited into the employees' bank accounts. Assume Lighting Electronics must also pay $250 of unemployment taxes for this pay period.
Prepare the journal entry or entries that Lightning would use to record the payroll. Include both employee and employer taxes. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)
1) Record the wages expense for November 1-14 time period, including payroll deductions.
2) Record the payroll tax expense.