Legend Company employs the following 4 employees: Cumulative Current Pension SS MC Earnings Pay John $122,000.00 $6,100.00 Paul 109,000.00 5,450.00 George 117,000.00 5,850.00 Ringo 118,500.00 5,925.00 FIT W/H Contribution тих Tax $826.60 4% 0 88.45 970.43 6% 337.90 79.025 764.10 2% 93 84.83 1,339.75 0% O 85.91 430.9 338.23 The Social Security tax rate is 6.2% and the Medicare rate is 1.45%, assume the social security wage base is $118,500. FUTAand SUTA are assessed on the first $7,000 of employee's earnings at a rate of .6% and 2% respectively. Additionally, each employee makes a retirement plan contribution as indicated above, Legend matches the first 4% of employee pension contributions dollar for dollar. Required: 1. Calculate each employee's net pay & prepare the journal entry to record the payroll accrual on Legend's books. 2. Calculate the employer's FICA, FUTA and SUTA tax obligations and the journal entry to record the payroll tax on Legend's books.
Legend Company employs the following 4 employees: Cumulative Current Pension SS MC Earnings Pay John $122,000.00 $6,100.00 Paul 109,000.00 5,450.00 George 117,000.00 5,850.00 Ringo 118,500.00 5,925.00 FIT W/H Contribution тих Tax $826.60 4% 0 88.45 970.43 6% 337.90 79.025 764.10 2% 93 84.83 1,339.75 0% O 85.91 430.9 338.23 The Social Security tax rate is 6.2% and the Medicare rate is 1.45%, assume the social security wage base is $118,500. FUTAand SUTA are assessed on the first $7,000 of employee's earnings at a rate of .6% and 2% respectively. Additionally, each employee makes a retirement plan contribution as indicated above, Legend matches the first 4% of employee pension contributions dollar for dollar. Required: 1. Calculate each employee's net pay & prepare the journal entry to record the payroll accrual on Legend's books. 2. Calculate the employer's FICA, FUTA and SUTA tax obligations and the journal entry to record the payroll tax on Legend's books.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
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![Legend Company employs the following 4 employees:
Cumulative Current
Pension
SS
MC
Earnings Pay
John $122,000.00 $6,100.00
Paul 109,000.00 5,450.00
George 117,000.00 5,850.00
Ringo 118,500.00 5,925.00
FIT W/H Contribution
тих
Tax
$826.60
4%
0
88.45
970.43
6%
337.90
79.025
764.10
2%
93
84.83
1,339.75
0%
O
85.91
430.9
338.23
The Social Security tax rate is 6.2% and the Medicare rate is 1.45%, assume the social
security wage base is $118,500. FUTAand SUTA are assessed on the first $7,000 of
employee's earnings at a rate of .6% and 2% respectively. Additionally, each employee
makes a retirement plan contribution as indicated above, Legend matches the first 4% of
employee pension contributions dollar for dollar.
Required:
1. Calculate each employee's net pay & prepare the journal entry to record the
payroll accrual on Legend's books.
2. Calculate the employer's FICA, FUTA and SUTA tax obligations and the journal
entry to record the payroll tax on Legend's books.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb7e2715d-9228-4bea-bca7-43a7e63da978%2Fac95f015-28fa-49dc-8d78-e825153bf897%2Fz16ybba_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Legend Company employs the following 4 employees:
Cumulative Current
Pension
SS
MC
Earnings Pay
John $122,000.00 $6,100.00
Paul 109,000.00 5,450.00
George 117,000.00 5,850.00
Ringo 118,500.00 5,925.00
FIT W/H Contribution
тих
Tax
$826.60
4%
0
88.45
970.43
6%
337.90
79.025
764.10
2%
93
84.83
1,339.75
0%
O
85.91
430.9
338.23
The Social Security tax rate is 6.2% and the Medicare rate is 1.45%, assume the social
security wage base is $118,500. FUTAand SUTA are assessed on the first $7,000 of
employee's earnings at a rate of .6% and 2% respectively. Additionally, each employee
makes a retirement plan contribution as indicated above, Legend matches the first 4% of
employee pension contributions dollar for dollar.
Required:
1. Calculate each employee's net pay & prepare the journal entry to record the
payroll accrual on Legend's books.
2. Calculate the employer's FICA, FUTA and SUTA tax obligations and the journal
entry to record the payroll tax on Legend's books.
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