Palouse Company completed the salary and wage payroll for the month of March. The payroll provided the following details: Salaries and wages earned by employees $ 217,000 Employee income taxes withheld 43,400 Employee government insurance premiums withheld 4,000 FICA payroll taxes* 15,300 *Assessed on both employer and employee (i.e., $15,300 each). Required: Prepare the journal entry to record the payroll for March, including employee deductions. Assume employees have been paid, but that Palouse has yet to transfer any withholdings to the government. Prepare the journal entry to record the employer's payroll taxes, which have not yet been paid to the government. Provide a combined journal entry to show the payment of all amounts owed to governmental agencies.Answer the question:Journal 1. Record the payroll for March, including employee deductions.Journal 2. Record the employer's payroll taxes.Journal 3. Record the entry to show the payment of amounts owed to governmental agencies.Bank:  Accounts payableCashCompensation expenseDeferred revenue FICA taxes payable - employees Fica taxes payable - employerinterest expense interest payableinterest revenue Liability for income taxes withheld - employeesLiability for insurance premiums withheld - employeesnote payable property taxes payablePurchasesRent revenueSavings accountService revenueWage payable Warranty expense warranty payable

College Accounting (Book Only): A Career Approach
13th Edition
ISBN:9781337280570
Author:Scott, Cathy J.
Publisher:Scott, Cathy J.
Chapter8: Employer Taxes, Payments, And Reports
Section: Chapter Questions
Problem 3E
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Palouse Company completed the salary and wage payroll for the month of March. The payroll provided the following details:

Salaries and wages earned by employees $ 217,000
Employee income taxes withheld 43,400
Employee government insurance premiums withheld 4,000
FICA payroll taxes* 15,300

*Assessed on both employer and employee (i.e., $15,300 each).

Required:

  1. Prepare the journal entry to record the payroll for March, including employee deductions. Assume employees have been paid, but that Palouse has yet to transfer any withholdings to the government.
  2. Prepare the journal entry to record the employer's payroll taxes, which have not yet been paid to the government.
  3. Provide a combined journal entry to show the payment of all amounts owed to governmental agencies.

    Answer the question:
    Journal 1. Record the payroll for March, including employee deductions.
    Journal 2. Record the employer's payroll taxes.
    Journal 3. Record the entry to show the payment of amounts owed to governmental agencies.

    Bank: 

    Accounts payable
    Cash
    Compensation expense
    Deferred revenue

    FICA taxes payable - employees

    Fica taxes payable - employer
    interest expense
    interest payable
    interest revenue

    Liability for income taxes withheld - employees
    Liability for insurance premiums withheld - employees
    note payable
    property taxes payable
    Purchases
    Rent revenue
    Savings account
    Service revenue
    Wage payable
    Warranty expense
    warranty payable



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