For the year ended December 31, 2017, Denkinger Electrical Repair Company reports the following summary payroll data.
Question:
For the year ended December 31, 2017, Denkinger Electrical Repair Company reports the following summary payroll data.
Gross earnings: | ||
Administrative salaries | $192,500 | |
Electricians’ wages | 355,000 | |
Total | $547,500 | |
Deductions: | ||
FICA taxes | $36,676 | |
Federal income taxes withheld | 174,500 | |
State income taxes withheld (3%) | 16,425 | |
United Fund contributions payable | 26,414 | |
Health insurance premiums | 20,000 | |
Total | $274,015 |
Denkinger 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 $463,500, and gross earnings subject to unemployment taxes total $140,000.
(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. |
(Round answers to 0 decimal places, e.g. 125. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
The W-2 Wage and Tax Statement requires the following dollar data.
Complete the required data for the following employees. (Round answers to 0 decimal places, e.g. 5,275.)
Accounting Principles
ISBN: 978-1118875056
12th edition
Authors: Jerry Weygandt, Paul Kimmel, Donald Kieso