reviewact312sol[1]

reviewact312sol[1] - 225,000 FICA Taxes Payable 60,460 Cash...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
Total payroll of Watson Co. was $920,000, of which $160,000 represented amounts paid in excess of $100,000 to certain employees. The amount paid to employees in excess of $7,000 was $720,000. Income taxes withheld were $225,000. The state unemployment tax is 1.2%, the federal unemployment tax is .8%, and the F.I.C.A. tax is 7.65% on an employee’s wages to $100,000 and 1.45% in excess of $100,000. a) Prepare the journal entry for the wages and salaries paid. (b) Prepare the entry to record the employer payroll taxes (a) Wages and Salaries Expense. ....................................................... 920,000 Withholding Taxes Payable. ............................................
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: 225,000 FICA Taxes Payable. ....................................................... 60,460* Cash. ................................................................................. 634,540 * [($920,000 – $160,000) × 7.65%] + ($160,000 × 1.45%) (b) Payroll Tax Expense . ................................................................. 64,460 FICA Taxes Payable ($760,000 × 7.65%) + ($160,000 × 1.45%). .............. 60,460 Federal Unemployment Tax Payable [($920,000 – $720,000) × .8%] . ................................ 1,600 State Unemployment Tax Payable ($200,000 × 1.2%) . . 2,400...
View Full Document

This note was uploaded on 10/20/2010 for the course ACT 0112689 taught by Professor Kzate during the Spring '10 term at Maryland.

Ask a homework question - tutors are online