For the year ended December 31, 2017, Grayson Electrical Repair Company reports the following summary payroll data.
Question:
For the year ended December 31, 2017, Grayson Electrical Repair Company reports the following summary payroll data.
Gross earnings:
Administrative salaries.........................$180,000
Electricians' wages..............................390,000
Total..............................................$570,000
Deductions:
FICA taxes.......................................$ 37,405
Federal income taxes withheld.................168,000
State income taxes withheld (3.2%)............18,240
United Fund contributions payable.............27,500
Hospital insurance premiums....................32,200
Total..............................................$283,345
Grayson Company's payroll taxes are Social Security tax 6.2%, Medicare tax 1.45%, state unemployment 2.5% (due to a stable employment record), and 0.8% federal unemployment. Gross earnings subject to Social Security taxes of 6.2% total $470,000, and gross earnings subject to unemployment taxes total $125,000.
Instructions
(a) Prepare a summary journal entry at December 31 for the full year's payroll.
(b) Journalize the adjusting entry at December 31 to record the employer's payroll taxes.
(c) The W-2 Wage and Tax Statement requires the following dollar data.
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Complete the required data for the following employees.
Employee Gross Earnings Federal Income Tax Withheld
Jin Chien..........................$59,000..............................................$19,500
Nina Harris.........................28,000.................................................7,200
Step by Step Answer:
a Salaries and Wages Expense 570000 FICA Taxes Payable 37405 Federal In...View the full answer
Financial Accounting
ISBN: 978-1118978085
IFRS 3rd edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
