payroll accounting problems chapter 7

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Description

1. Harriet Pandel, an employer, is subject to FICA taxes but exempt
from FUTA and SUTA taxes. During last quarter of the year, her employees earned
monthly wages of $16,900, all of which is taxable. The amount of federal income taxes withheld each month is
$1,698. Journalize the payment of wages
and record the payroll tax on November 29.

Date

JOURNAL ENTRY

DEBIT

CREDIT

2.
Prior to posting the November 29 payroll transaction, FICA Taxes
Payable-OASDI, FICA Taxes Payable-HI and Employees FIT Payable had zero
balances. Pandel must pay FICA taxes and income taxes withheld on the November
29 payroll. Journalize the electronic
transfer of the payroll taxes on December 16.

Date

JOURNAL ENTRY

DEBIT

CREDIT

3. The employees of Carson Bakery Company earned
wages of $7,780 during January. The
total amount is taxable under FICA, FUTA, and SUTA. The state contribution rate for the company
is 4.3%. Carson Bakery is responsible for SUTA and has always paid timely. The
amount withheld for federal income taxes is $998. Journalize the payment of monthly wages, and
record the payroll taxes.

Date

JOURNAL ENTRY

DEBIT

CREDIT

4. Purnell, Inc. has
a semimonthly payroll of $53,900 on September 13. The total payroll is taxable
under FICA Taxes-HI: $50,400 is taxable under FICA Taxes- OASDI; and $7,300 is
taxable under FUTA and SUTA. The state
contribution rate for the company is 3.1%. Purnell is responsible for SUTA and
has always paid timely. The amount withheld for federal income taxes is $6,995.
The amount withheld for state income taxes is $1,010.

a. Journalize the payment of the wages, and
record the payroll taxes on September 13.

Date

JOURNAL ENTRY

DEBIT

CREDIT

5.
On December 31, 2013, Santucci Company has a balance of $619.24 in the
FUTA taxes payable account. This represents the employer’s liability for the
fourth quarter taxes. Journalize the entry Santucci should make in January 2014
to record the last transfer payment of FUTA taxes for 2013.

Date

JOURNAL ENTRY

DEBIT

CREDIT

6.
On December 31, 2012, Sanchez Company needed to record its accrued wages
for year-end. December 31 is on
Wednesday. The company operates on a five-day workweek, the prior week’s gross
pay (December 26 payday) was $29,870, and the net pay was $19,995. Journalize
the December 31 entry.

Date

JOURNAL ENTRY

DEBIT

CREDIT

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