Constantino Public Relations pays its employees monthly. Payments made by the company on November 30, 2016, follow. Cumulative amounts paid to the persons named prior to November 30 are also given.

1. Tony Constantino, president, gross monthly salary of $18,000; gross earnings prior to November 30, $180,000.

2. Chris Stamos, vice president, gross monthly salary of $15,000; gross earnings paid prior to November 30, $150,000.

3. Brenda Cates, independent media buyer who purchases media contracts for companies and performs other public relations consulting services, $15,650; gross amounts paid prior to November 30, $52,850.

4. Elaine Hayakawa, treasurer, gross monthly salary of $6,400; gross earnings prior to November 30, $64,000.

5. Payment to the Queen Marketing Group for monthly services of Cheryl Queen, a marketing and public relations expert, $15,500; amount paid to the Queen Marketing Group prior to November 30, $46,500.

INSTRUCTIONS

1. Use an earnings ceiling of $113,700 and a tax rate of 6.2 percent for social security taxes and a tax rate of 1.45 percent on all earnings for Medicare taxes. Prepare a schedule showing the following information:

a. Each employee's cumulative earnings prior to November 30.

b. Each employee's gross earnings for November.

c. The amounts to be withheld for each payroll tax from each employee's earnings; the employee's income tax withholdings are Tony Constantino, $5,110; Chris Stamos, $3,700; Elaine Hayakawa, $1,200.

d. The net amount due each employee.

e. The total gross earnings, the total of each payroll tax deduction, and the total net amount payable to employees.

2. Give the general journal entry to record the company's payroll on November 30. Use journal page 24. Omit explanations.

3. Give the general journal entry to record payments to employees on November 30.

Analyze: What month in 2016 did Chris Stamos reach the withholding limit for social security?