Don McCullum operates a travel agency called Don's Luxury Travel. He has five employees, all of whom are paid on a weekly basis. The travel agency uses a payroll register, individual employee earnings records, and a general journal. Don's Luxury Travel uses a weekly federal income tax withholding table. The payroll data for each employee for the week ended March 22, 20', are given on the following page. Employees are paid 1½ times the regular rate for working over 40 hours a week.

Social Security tax is withheld from the first $106,800 of earnings at the rate of 6.2%. Medicare tax is withheld at the rate of 1.45%, and city earnings tax at the rate of 1%, both applied to gross pay. Ali and Knox have $15.00 withheld and Carson and Hernandez have $5.00 withheld for health insurance. Ali and Knox have $20.00 withheld to be invested in the travel agency's credit union. Carson has $38.75 withheld and Hernandez has $18.75 withheld under a savings bond purchase plan.
Don's Luxury Travel's payroll is met by drawing checks on its regular bank account. The checks were issued in sequence, beginning with Check No. 423.
REQUIRED
1. Prepare a payroll register for Don's Luxury Travel for the week ended March 22, 20--. (In the Taxable Earnings/Unemployment Compensation column, enter the same amounts as in the Social Security column.) Total the amount columns, verify the totals, and rule with single and double lines.
2. Assuming that the wages for the week ended March 22 were paid on March 24, prepare the journal entry for the payment of thepayroll.

Transcribed Image Text:

No. of Allowances Total Hours Worked Mar. 16-22 45 40 43 39 40 Total Earnings Jan. 1-Mar. 15 Marital Status Name Rate Ali, Loren $11.00 12.00 9.50 11.00 10.50 $5,280.00 5,760.00 4 M Carson, Judy Hernandez, Maria Knox, Wayne Paglione, Jim M 5,125.50 4,720.50