Question

The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $300,000; Office salaries, $60,000; Federal income taxes withheld, $90,000; State income taxes withheld, $20,000; Social security taxes withheld, $22,320; Medicare taxes withheld, $5,220; Medical insurance premiums, $7,000; Life insurance premiums, $4,000; Union dues deducted, $1,000; and Salaries subject to unemployment taxes, $50,000. The employee pays forty percent of medical and life insurance premiums. Prepare journal entries to record:
(1) Accrued payroll, including employee deductions, for July;
(2) Cash payment of the net payroll (salaries payable) for July;
(3) Accrued employer payroll taxes, and other related employment expenses, for July— assume that FICA taxes are identical to those on employees and that SUTA taxes are 5.4% and FUTA taxes are 0.8%;
(4) Cash payment of all liabilities related to the July payroll.



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  • CreatedNovember 26, 2013
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