For all payroll calculations, use the following tax rates and round amounts to the nearest cent Employee: OASDI: 6.2% on first $118,500 earned; Medicare 1.45% up to $200,000, 2.35% on earnings above $200,000. Employer: OASDI: 6.2% on first $118,500 earned; Medicare: 1.45%; FUTA: 0.6% on first $7,000 earned; SUTA: 5.4% on first $7,000 earned. Computing bonus payable On December 31, Weston Company estimates that it will pay its employees a 5% bonus on net income after deducting the bonus. The company reports net income of $64,000 before the calculation of the bonus. The Bonus will be paid on January 15 of the next year. Requirements Journalize the December 31 transaction for Weston. Journalize the payment of the bonus on January 15.
For all payroll calculations, use the following tax rates and round amounts to the nearest cent Employee: OASDI: 6.2% on first $118,500 earned; Medicare 1.45% up to $200,000, 2.35% on earnings above $200,000. Employer: OASDI: 6.2% on first $118,500 earned; Medicare: 1.45%; FUTA: 0.6% on first $7,000 earned; SUTA: 5.4% on first $7,000 earned. Computing bonus payable On December 31, Weston Company estimates that it will pay its employees a 5% bonus on net income after deducting the bonus. The company reports net income of $64,000 before the calculation of the bonus. The Bonus will be paid on January 15 of the next year. Requirements Journalize the December 31 transaction for Weston. Journalize the payment of the bonus on January 15.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
For all payroll calculations, use the following tax rates and round amounts to the nearest cent
Employee: OASDI: 6.2% on first $118,500 earned; Medicare 1.45% up to $200,000, 2.35% on earnings above $200,000.
Employer: OASDI: 6.2% on first $118,500 earned; Medicare: 1.45%; FUTA: 0.6% on first $7,000 earned; SUTA: 5.4% on first $7,000 earned.
Computing bonus payable
On December 31, Weston Company estimates that it will pay its employees a 5% bonus on net income after deducting the bonus. The company reports net income of $64,000 before the calculation of the bonus. The Bonus will be paid on January 15 of the next year.
Requirements
- Journalize the December 31 transaction for Weston.
- Journalize the payment of the bonus on January 15.
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