The payroll of Sumerlus Corp. for September 2017 is as follows. Total payroll was $485,000. Pensionable (CPP)
Question:
The payroll of Sumerlus Corp. for September 2017 is as follows. Total payroll was $485,000. Pensionable (CPP) and insurable (EI) earnings were $365,000. Income taxes in the amount of $85,000 were withheld, as were $8,000 in union dues. The EI tax rate was 1.88% for employees and 2.632% for employers, and the CPP rate was 4.95% for employees and 4.95% for employers.
Instructions
(a) Prepare the necessary journal entries to record the payroll if the salaries and wages paid and the employer payroll taxes are recorded separately.
(b) Prepare the entries to record the payment of all required amounts to the Receiver General and to the employees' union.
(c) For every dollar of salaries and wages that Sumerlus commits to pay, what is the actual payroll cost to the company?
(d) Discuss any other costs, direct or indirect, that you think would add to the company's costs of having employees.
Step by Step Answer:
a Salaries and Wages Expense 485182 Employee Income Tax Deductions Payable 85000 EI Premiums Payable ...View the full answer
Intermediate Accounting
ISBN: 978-1119048541
11th Canadian edition Volume 2
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Nicola M. Young, Irene M. Wiecek, Bruce J. McConomy
