Recording payroll and payroll taxes.Assume that the company is subject to a 2% state unemployment tax and 0.6% federal unemployment tax.REQUIRED: Record the following in general journal entry form on May 31.A. Accrual of monthly payroll B. Payment of the net payrollC. Accrual of employers payroll taxes(assume that the FICA matches the amount withhold)D. Payment of these payroll related liabilities. (assume that all are settled at the same time)The options for the shaded drop boxes are :Administrative salaries expense, cash, custodial salaries expense, federal income tax withholding payable, federal unemployment tax payable, FICA tax payable, payroll payable, payroll tax expense, sales salaries expense, state unemployment tax payable. ### Payroll Accounting Exercise#### TaskRecord the following in general journal form on May 31:1. **Accrual of the monthly payroll**2. **Payment of the net payroll**3. **Accrual of employer’s payroll taxes** - Assume that the FICA matches the amount withheld from employees.4. **Payment of these payroll-related liabilities** - Assume that all are settled at the same time.*Note: Round your answers to the nearest dollar.*#### Journal Entry ExampleIn the example above, the journal entry on May 31 for the accrual of the monthly payroll looks as follows:##### General Journal| **Date** | **Description** | **Debit** | **Credit** ||-----------|---------------------------------------|-----------|------------|| May 31 | Administrative Salaries Expense | $ 0 | $ 0 || | Sales Salaries Expense | 0 | 0 || | Federal Income Tax Withholding Payable| 0 | 0 || | FICA Tax Payable | 0 | 0 || | To record May payroll. | | |Please ensure that you enter the correct amounts for each line item based on your specific payroll data. This example shows the account titles but does not yet include monetary amounts, which you need to calculate based on your payroll records. **Recording Payroll and Payroll Taxes**The following data are taken from Stockton Wholesale Company’s May payroll:| **Category** | **Amount** ||----------------------------------------------------|-------------|| Administrative salaries | $50,000 || Sales salaries | $51,000 || Custodial salaries | $7,000 || **Total payroll** | **$108,000** || Salaries subject to 1.45 percent Medicare tax | $108,000 || Salaries subject to 6.2 percent Social Security tax | $85,000 || Salaries subject to federal unemployment taxes | $14,000 || Salaries subject to state unemployment taxes | $21,000 || Federal income taxes withheld from all salaries | $17,800 |Assume that the company is subject to a two percent state unemployment tax (due to a favorable experience rating) and a 0.6 percent federal unemployment tax.**Required**Record the following in general journal form on May 31:a. Accrual of the monthly payroll.b. Payment of the net payroll.c. Accrual of employer’s payroll taxes. (Assume that the FICA matches the amount withheld.)d. Payment of these payroll-related liabilities. (Assume that all are settled at the same time.)Round your answers to the nearest dollar.

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Answered: Recording Payroll and Payroll Taxes The…

Century 21 Accounting General Journal

11th Edition

ISBN:9781337680059

Author:Gilbertson

Publisher:Gilbertson

Chapter13: Accounting For Payroll And Payroll Taxes

Section13.1: Recording A Payroll

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Recording payroll and payroll taxes. Assume that the company is subject to a 2% state unemployment tax and 0.6% federal unemployment tax. REQUIRED: Record the following in general journal entry form on May 31. A. Accrual of monthly payroll B. Payment of the net payroll C. Accrual of employers payroll taxes(assume that the FICA matches the amount withhold) D. Payment of these payroll related liabilities. (assume that all are settled at the same time) The options for the shaded drop boxes are : Administrative salaries expense, cash, custodial salaries expense, federal income tax withholding payable, federal unemployment tax payable, FICA tax payable, payroll payable, payroll tax expense, sales salaries expense, state unemployment tax payable.

### Payroll Accounting Exercise

#### Task
Record the following in general journal form on May 31:

1. **Accrual of the monthly payroll**
2. **Payment of the net payroll**
3. **Accrual of employer’s payroll taxes**
- Assume that the FICA matches the amount withheld from employees.
4. **Payment of these payroll-related liabilities**
- Assume that all are settled at the same time.

*Note: Round your answers to the nearest dollar.*

#### Journal Entry Example

In the example above, the journal entry on May 31 for the accrual of the monthly payroll looks as follows:

##### General Journal

| **Date** | **Description** | **Debit** | **Credit** |
|-----------|---------------------------------------|-----------|------------|
| May 31 | Administrative Salaries Expense | $ 0 | $ 0 |
| | Sales Salaries Expense | 0 | 0 |
| | Federal Income Tax Withholding Payable| 0 | 0 |
| | FICA Tax Payable | 0 | 0 |
| | To record May payroll. | | |

Please ensure that you enter the correct amounts for each line item based on your specific payroll data. This example shows the account titles but does not yet include monetary amounts, which you need to calculate based on your payroll records.

**Recording Payroll and Payroll Taxes**

The following data are taken from Stockton Wholesale Company’s May payroll:

| **Category** | **Amount** |
|----------------------------------------------------|-------------|
| Administrative salaries | $50,000 |
| Sales salaries | $51,000 |
| Custodial salaries | $7,000 |
| **Total payroll** | **$108,000** |
| Salaries subject to 1.45 percent Medicare tax | $108,000 |
| Salaries subject to 6.2 percent Social Security tax | $85,000 |
| Salaries subject to federal unemployment taxes | $14,000 |
| Salaries subject to state unemployment taxes | $21,000 |
| Federal income taxes withheld from all salaries | $17,800 |

Assume that the company is subject to a two percent state unemployment tax (due to a favorable experience rating) and a 0.6 percent federal unemployment tax.

**Required**

Record the following in general journal form on May 31:

a. Accrual of the monthly payroll.
b. Payment of the net payroll.
c. Accrual of employer’s payroll taxes. (Assume that the FICA matches the amount withheld.)
d. Payment of these payroll-related liabilities. (Assume that all are settled at the same time.)

Round your answers to the nearest dollar.

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