The following accounts, with the balances indicated, appear in the ledger of Brownie Points Gifts Inc. on December 1 of the current year:

The following transactions relating to payroll, payroll deductions, and payroll taxes occurred during December:
Dec. 2. Issued Check No. 728 for $2,400 to First National Bank to purchase U.S. savings bonds for employees.
3. Issued Check No. 729 to First National Bank for $23,885, in payment of $8,276 of social security tax, $2,178 of Medicare tax, and $13,431 of employees’ federal income tax due.
14. Journalized the entry to record the biweekly payroll. A summary of the payroll record follows:

14. Issued Check No. 738 in payment of the net amount of the biweekly payroll.
Dec. 14. Journalized the entry to record payroll taxes on employees earnings of December 14: social security tax, $3,960; Medicare tax, $1,080; state unemployment tax, $285; federal unemployment tax, $71.
17. Issued Check No. 744 to First National Bank for $22,896, in payment of $7,920 of social security tax, $2,160 of Medicare tax, and $12,816 of employees’ federal income tax due.
18. Issued Check No. 750 to Pico Insurance Company for $9,000, in payment of the semiannual premium on the group medical insurance policy.
28. Journalized the entry to record the biweekly payroll. A summary of the payroll record follows:

28. Issued Check No. 782 in payment of the net amount of the biweekly payroll.
28. Journalized the entry to record payroll taxes on employees’ earnings of December 28: social security tax, $3,931; Medicare tax, $1,092; state unemployment tax, $166; federal unemployment tax, $42.
30. Issued Check No. 791 to First National Bank for $2,400 to purchase U.S. savings bonds for employees.
30. Issued Check No. 792 for $19,584 to First National Bank in payment of employees’ state income tax due on December 31.
31. Paid $46,000 to the employee pension plan. The annual pension cost is $50,000. (Record both the payment and unfunded pension liability.)

Instructions
1. Journalize the transactions.
2. Journalize the following adjusting entries on December 31:
a. Salaries accrued: operations salaries, $4,320; officers salaries, $1,820; office salaries, $1,140. The payroll taxes are immaterial and are not accrued.
b. Vacation pay,$13,200.

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218 Bond Deductions Payable 2,400 8,276 219 Medical Insurance Payable 9,000 2,178 611 Operations Salaries Expense 946,000 211 Salaries Payable 212 Social Security Tax Payable 213 Medicare Tax Payable 214 Employees Federal Income Tax Payable 13,43 711 Officers Salaries Expense 404,800 215 Employees State Income Tax Payable 13,068 712 Office Salaries Expense 216 State Unemployment Tax Payable 217 Federal Unemployment Tax Payable 246,400 123,244 1,200 719 Payroll Taxes Expense 300 Salary distribution: Operations Officers Office $42,500 18,500 000 11, $72,000 Deductions: Social security tax Medicare tax Federal income tax withheld State income tax withheld Savings bond deductions Medical insurance deductions 3,960 1,080 12,816 3,240 1,200 1,500 23,796 48,204 Net amount Salary distribution: Operations Officers Office $43,200 18,200 11,400 $72,800 Deductions: Social security tax Medicare tax Federal income tax withheld State income tax withheld Savings bond deductions 3,931 1,092 12,958 3,276 1,200 22,457 $50,343 Net amount