The following information is for Union Express Delivery Service's workers' compensation insurance premiums. On January 15, 2019, the company estimated its premium for workers' compensation insurance for the year on the basis of the following data:
Work Classification ..........Amount of Estimated ..........Wages Insurance Rates
Office work .....................................$ 50,000 ...........................$0.50/$100
Delivery work ....................................308,000 ...........................$6.00/$100
INSTRUCTIONS
1. Use the information to compute the estimated premium for the year.
2. A check was issued to pay the estimated premium on January 17, 2019. Record the transaction in general journal form. Use 7 as the page number.
3. On January 19, 2020, an audit of the firm's payroll records showed that it had actually paid wages of $52,970 to its office employees and wages of $316,240 to its delivery employees.
Compute the actual premium for the year and the balance due the insurance company or the credit due the firm.
4. Give the general journal entry to adjust the Workers' Compensation Insurance Expense account. Date the entry December 31, 2019. Use 88 as the page number.
Analyze:
What is the balance of the Workers' Compensation Insurance Expense account at December 31, 2019, after all journal entries have been posted?