Keith, an employee of Sunbeam, Inc., has gross salary for May of $10,000. The entire amount is under the OASDI limit of $132,900 and thus subject to FICA. He is also subject to federal income tax at a rate of 21%. Which of the following is a part of the journal entry to record the disbursement of his net pay? (Assume a FICA-OASDI Tax of 6.2% and FICA-Medicare Tax of 1.45 %.) (Round the final answer to the nearest dollar.) O debit to Cash for $7,135.00 O debit to Employee Income Tax Payable of $7,135.00 O debit to FICA Tax Payable of $7,135.00 O credit to Cash for $7,135.00
Keith, an employee of Sunbeam, Inc., has gross salary for May of $10,000. The entire amount is under the OASDI limit of $132,900 and thus subject to FICA. He is also subject to federal income tax at a rate of 21%. Which of the following is a part of the journal entry to record the disbursement of his net pay? (Assume a FICA-OASDI Tax of 6.2% and FICA-Medicare Tax of 1.45 %.) (Round the final answer to the nearest dollar.) O debit to Cash for $7,135.00 O debit to Employee Income Tax Payable of $7,135.00 O debit to FICA Tax Payable of $7,135.00 O credit to Cash for $7,135.00
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Keith, an employee of Sunbeam, Inc., has a gross salary for May of $10,000. The entire amount is under the OASDI limit of $132,900 and thus subject to FICA. He is also subject to federal income tax at a rate of 21%. Which of the following is a part of the journal entry to record the disbursement of his net pay? (Assume a FICA—OASDI Tax of 6.2% and FICA—Medicare Tax of 1.45%.) (Round the final answer to the nearest dollar.)
- ○ debit to Cash for $7,135.00
- ○ debit to Employee Income Tax Payable of $7,135.00
- ○ debit to FICA Tax Payable of $7,135.00
- ○ credit to Cash for $7,135.00
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