Hidden Dragon Restaurant's gross payroll for April is $45,500. The company deducted $2,108 for CPP, $833 for EI, and $8,798 for income taxes from the employees' cheques. Employees are paid monthly at the end of each month.
Instructions
(a) Prepare a journal entry for Hidden Dragon on April 30 to record the payment of the April payroll to employees.
(b) Prepare a journal entry on April 30 to accrue Hidden Dragon's employer payroll costs. Assume that Hidden Dragon is assessed workers' compensation premiums at a rate of 1% per month and accrues for vacation pay at a rate of 4% per month.
(c) On May 15, Hidden Dragon pays the government the correct amounts for April's payroll. Prepare a journal entry to record this remittance.