Question

The following accounts, with the balances indicated, appear in the ledger of Acadia Outdoor Equipment Company on December 1 of the current year:


The following transactions relating to payroll, payroll deductions, and payroll taxes occurred during December:
Dec. 1. Issued Check No. 728 to Pico Insurance Company for $4,200, in payment of the semiannual premium on the group medical insurance policy.
2. Issued Check No. 729 to First National Bank for $17,997, in payment for $6,236 of social security tax, $1,641 of Medicare tax, and $10,120 of employees’ federal income tax due.
3. Issued Check No. 730 for $1,500 to First National Bank to purchase U.S. savings bonds for employees.
14. Journalized the entry to record the biweekly payroll. A summary of the payroll record follows:


14. Issued Check No. 738 in payment of the net amount of the biweekly payroll.
14. Journalized the entry to record payroll taxes on employees’ earnings of December 14: social security tax, $2,948; Medicare tax, $804; state unemployment tax, $260; federal unemployment tax, $65.
Dec. 17. Issued Check No. 744 to First National Bank for $17,045, in payment for $5,896 of social security tax, $1,608 of Medicare tax, and $9,541 of employees’ federal income tax due.
28. Journalized the entry to record the biweekly payroll. A summary of the payroll record follows:


28. Issued Check No. 782 for the net amount of the biweekly payroll.
28. Journalized the entry to record payroll taxes on employees’ earnings of December 28: social security tax, $2,959; Medicare tax, $822; state unemployment tax, $160; federal unemployment tax, $40.
30. Issued Check No. 791 for $14,724 to First National Bank, in payment of employees’ state income tax due on December 31.
30. Issued Check No. 792 to First National Bank for $1,500 to purchase U.S. savings bonds for employees.
31. Paid $59,500 to the employee pension plan. The annual pension cost is $65,000. (Record both the payment and the unfunded pension liability.)

Instructions
1. Journalize the transactions.
2. Journalize the following adjusting entries on December 31:
a. Salaries accrued: sales salaries, $3,360; officers salaries, $1,600; office salaries, $520. The payroll taxes are immaterial and are not accrued.
b. Vacation pay,$13,600.


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  • CreatedNovember 08, 2012
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