Part $2$ Instructions: Calculate and answer each question below. Be sure to show all work.

Arlo Inc pays a weekly payroll of $$255,000$ that includes federal taxes withheld of $$38,100,$ FICA taxes withheld of

$$23,670,$ and $401(k)$ withholdings of $$27,000.$ What is the effect on assets and liabilities from this transaction?

Answer:

Arlo provides its employees two weeks of paid vacation per year. As of December $31,65$ employees have earned

two weeks of vacation time to be taken the following year. If the average weekly salary for these employees is $$900,$

what is the required journal entry?

Answer:

The total payroll of Arlo Inc for the month of October, $2020$ was $$960,000,$ of which $$180,000$ represented amounts

paid in excess of $$128,400$ to certain employees. $$600,000$ represented amounts paid to employees in excess of the

$$7,000$ maximum subject to unemployment taxes. $$180,000$ of federal income taxes and $$18,000$ of union dues were

withheld. The state unemployment tax is $1\%,$ the federal unemployment tax is $\mathrm{.}8\%,$ and the current F$.$I.C$.$A$.$ tax is

$7\mathrm{.}65\%$ on an employee's wages to $$128,400$ and $1\mathrm{.}45\%$ in excess of $$128,400.$ What amount should Arlo record as

payroll tax expense?

Answer: