Lee Financial Services pays employees monthly. Payroll information is listed below for January 2021, the first month
Question:
Lee Financial Services pays employees monthly. Payroll information is listed below for January 2021, the first month of Lee’s fiscal year. Assume that none of the employees exceeded any relevant base of pay, such that all benefit percentages apply to the entire $500,000 payroll.
Salaries .................................................................................$500,000
Federal income taxes to be withheld ...............................$100,000
Federal unemployment tax rate .............................................0.60%
State unemployment tax rate (after SUTA deduction) ........5.40%
Social Security tax rate ...............................................................6.2%
Medicare tax rate ......................................................................1.45%
Required:
Prepare the appropriate journal entries to record salaries expense and payroll tax expense for the January 2021 pay period.
Step by Step Answer:
Intermediate Accounting
ISBN: 978-1260481952
10th edition
Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas