Rand Company’s payroll on December 31 of the current year is as follows:•total payroll, $500,000•payroll in excess of $147,000 to each employee, $350,000•payroll in excess of $7,000 to each employee, $400,000•income taxes withheld, $85,000•union dues withheld, $10,000•tax rates: state unemployment tax, 5.4%; FICA tax, 8% for employees and 8% for employers for any amounts over $147,000; federal unemployment tax, 0.6% Required: Prepare the journal entries for Rand’s payroll and payroll taxes.

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Answered: Rand Company’s payroll on December 31…

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter9: Current Liabilities And Contingent Obligations

Section: Chapter Questions

Problem 14E

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Question

Rand Company’s payroll on December 31 of the current year is as follows:

•	total payroll, $500,000
•	payroll in excess of $147,000 to each employee, $350,000
•	payroll in excess of $7,000 to each employee, $400,000
•	income taxes withheld, $85,000
•	union dues withheld, $10,000
•	tax rates: state unemployment tax, 5.4%; FICA tax, 8% for employees and 8% for employers for any amounts over $147,000; federal unemployment tax, 0.6%