Calculation of Taxable Earnings and Employer Payroll Taxes and Preparation of Journal Entry

Selected information from the payroll register of Joanie's Boutique for the week ended September 14, 20--, is as follows: Social Security tax is 6.2% on the first $128,400 of earnings for each employee. Medicare tax is 1.45% of gross earnings. FUTA tax is 0.6% and SUTA tax is 5.4% on the first $7,000 of earnings.

				Taxable Earnings
Employee Name	Cumulative Pay Before Current Earnings		Current Gross Pay	Unemployment Compensation	Social Security
Jordahl, Stephanie		$6,450	$1,180
Keesling, Emily		6,100	1,050
Palmer, Stefan		55,180	2,410
Soltis, Robin		54,370	2,290
Stout, Hannah		28,860	2,060
Xia, Xu		127,320	3,660

1. Calculate the amount of taxable earnings for unemployment, Social Security, and Medicare taxes.

		Taxable Earnings
Employee Name	Current Earnings	Unemployment Compensation	Social Security
Jordahl, Stephanie	$	$	$
Keesling, Emily
Palmer, Stefan
Soltis, Robin
Stout, Hannah
Xia, Xu
Total	$	$	$

Social Security tax	$
Medicare tax
FUTA tax
SUTA tax
Total employer payroll taxes	$

2. Prepare the journal entry to record the employer's payroll taxes as of September 14, 20--.

Page:

	DATE	ACCOUNT TITLE	DOC. NO.	POST. REF.	DEBIT	CREDIT
1	20-- Sept. 14	FUTA Tax Payable					1
2							2
3							3
4							4
5							5