Review the February 26 and March 25 transactions for Business Solutions (SP 5) from Chapter 5.Required1. Assume that Lyn Addie is an unmarried employee. Her $1,000 of wages are subject to no deductions other than FICA Social Security taxes, FICA Medicare taxes, and federal income taxes. Her federal income taxes for this pay period total $159. Compute her net pay
Review the February 26 and March 25 transactions for Business Solutions (SP 5) from Chapter 5.
Required
1. Assume that Lyn Addie is an unmarried employee. Her $1,000 of wages are subject to no deductions other than FICA Social Security taxes, FICA Medicare taxes, and federal income taxes. Her federal income taxes for this pay period total $159. Compute her net pay for the eight days’ work paid on February 26. (Round amounts to the nearest cent.)
2. Record the journal entry to reflect the payroll payment to Lyn Addie as computed in part 1.
3. Record the journal entry to reflect the (employer) payroll tax expenses for the February 26 payroll payment. Assume Lyn Addie has not met earnings limits for FUTA and SUTA—the FUTA rate is 0.8% and the SUTA rate is 4% for Business Solutions. (Round amounts to the nearest cent.)
4. Record the entry(ies) for the merchandise sold on March 25 if a 4% sales tax rate applies.
Required
1. Assume that Lyn Addie is an unmarried employee. Her $1,000 of wages are subject to no deductions other than FICA Social Security taxes, FICA Medicare taxes, and federal income taxes. Her federal income taxes for this pay period total $159. Compute her net pay for the eight days’ work paid on February 26. (Round amounts to the nearest cent.)
2. Record the journal entry to reflect the payroll payment to Lyn Addie as computed in part 1.
3. Record the journal entry to reflect the (employer) payroll tax expenses for the February 26 payroll payment. Assume Lyn Addie has not met earnings limits for FUTA and SUTA—the FUTA rate is 0.8% and the SUTA rate is 4% for Business Solutions. (Round amounts to the nearest cent.)
4. Record the entry(ies) for the merchandise sold on March 25 if a 4% sales tax rate applies.
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Answer
1. Gross pay (8 days x $125 per day) ..................................................... $1,000.00 FICA Social Security tax deduction (6.2%)* ......…View the full answer
Related Book For 
Fundamental Accounting Principles
20th Edition
Authors: John J. Wild, Ken W. Shaw, Barbara Chiappetta
ISBN: 978-0078110870
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