On January 8, the end of the first weekly pay period of the year, Regis Company’s payroll register showed that its employees earned $ 22,760 of office salaries and $ 65,840 of sales salaries. Withholdings from the employees’ salaries include FICA Social Security taxes at the rate of 6.2%, FICA Medicare taxes at the rate of 1.45%, $ 12,860 of federal income taxes, $ 1,340 of medical insurance deductions, and $ 840 of union dues. No employee earned more than $ 7,000 in this first period.

1. Calculate FICA Social Security taxes payable and FICA Medicare taxes payable. Prepare the journal entry to record Regis Company’s January 8 (employee) payroll expenses and liabilities. (Round amounts to cents.)
2. Prepare the journal entry to record Regis’s (employer) payroll taxes resulting from the January 8 payroll. Regis’s merit rating reduces its state unemployment tax rate to 4% of the first $ 7,000 paid each employee. The federal unemployment tax rate is 0.8%. (Round amounts to cents.)

  • CreatedNovember 26, 2013
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