ompute Carty’s net pay for October. 2.Journalize the accrual of salaries expense and the payment related to the employment of Carti Little.
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.
Carti Little works for PHIL’S BURGERS all year and earns a monthly salary of $12,100. There is no overtime pay. Lily’s income tax withholding rate is 10% of gross pay. In addition to payroll taxes, Carti elects to contribute 5% monthly to United Way. PHIL’S BURGERS also deducts $250 monthly for co-payment of the health insurance premium. As of September 30, Carti had $108,900 of cumulative earnings.
Requirements
1.Compute Carty’s net pay for October.
2.Journalize the accrual of salaries expense and the payment related to the employment of Carti Little.
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