Question

For the year ended December 31, 2014, Denkinger Electrical Repair Company reports the following summary payroll data.
Gross earnings:
Administrative salaries ............ $200,000
Electricians’ wages .............. 370,000
Total ................... $570,000
Deductions:
FICA taxes .................. $ 38,645
Federal income taxes withheld .......... 174,400
State income taxes withheld (3%) ........ 17,100
United Fund contributions payable ...... 27,500
Health insurance premiums ......... 17,200
Total .................................................. $274,845
Denkinger Company’s payroll taxes are Social Security tax 6.2%, Medicare tax 1.45%, state unemployment 2.5% (due to a stable employment record), and 0.8% federal unemployment. Gross earnings subject to Social Security taxes of 6.2% total $490,000, and gross earnings subject to unemployment taxes total $135,000.

Instructions
(a) Prepare a summary journal entry at December 31 for the full year’s payroll.
(b) Journalize the adjusting entry at December 31 to record the employer’s payroll taxes.
(c) The W-2 Wage and Tax Statement requires the following dollar data.


Complete the required data for the followingemployees.


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  • CreatedJanuary 30, 2014
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