Sandhill Company’s payroll for December 2017 is summarized below. Amount Subject to Unemployment Taxes Payroll Wages Due Federal State Headquarters $210,000 $27,000 $7,000 Sales Office #1 57,000 7,000 2,000 Sales Office #2 47,000 4,000 1,000 Total $314,000 $38,000 $10,000 The state unemployment tax rate is 5.5%. However, Sandhill receives a 3.5% merit adjustment, bringing its effective state unemployment rate to 2.0%. The FICA rate is 7.65% on an employee’s wages to $140,000 and 1.45% in excess of $140,000. Of the $314,000 wages potentially subject to FICA tax, the following amounts are in excess of $140,000. Headquarters $21,000 Sales Office #1 24,000 Sales Office #2 19,000 The federal unemployment tax rate is 0.8% after credits. Income and payroll tax withheld amount to $24,000 for headquarters, $8,000 for sales office #1, and $7,700 for sales office #2. Prepare a schedule showing the employer’s total cost of wages for November by function. Prepare the journal entries to record the factory, sales, and administrative payrolls including the employer’s payroll taxes
Sandhill Company’s payroll for December 2017 is summarized below. Amount Subject to Unemployment Taxes Payroll Wages Due Federal State Headquarters $210,000 $27,000 $7,000 Sales Office #1 57,000 7,000 2,000 Sales Office #2 47,000 4,000 1,000 Total $314,000 $38,000 $10,000 The state unemployment tax rate is 5.5%. However, Sandhill receives a 3.5% merit adjustment, bringing its effective state unemployment rate to 2.0%. The FICA rate is 7.65% on an employee’s wages to $140,000 and 1.45% in excess of $140,000. Of the $314,000 wages potentially subject to FICA tax, the following amounts are in excess of $140,000. Headquarters $21,000 Sales Office #1 24,000 Sales Office #2 19,000 The federal unemployment tax rate is 0.8% after credits. Income and payroll tax withheld amount to $24,000 for headquarters, $8,000 for sales office #1, and $7,700 for sales office #2. Prepare a schedule showing the employer’s total cost of wages for November by function. Prepare the journal entries to record the factory, sales, and administrative payrolls including the employer’s payroll taxes
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Sandhill Company’s payroll for December 2017 is summarized below.
The state unemployment tax rate is 5.5%. However, Sandhill receives a 3.5% merit adjustment, bringing its effective state unemployment rate to 2.0%. The FICA rate is 7.65% on an employee’s wages to $140,000 and 1.45% in excess of $140,000. Of the $314,000 wages potentially subject to FICA tax, the following amounts are in excess of $140,000.
The federal unemployment tax rate is 0.8% after credits. Income and payroll tax withheld amount to $24,000 for headquarters, $8,000 for sales office #1, and $7,700 for sales office #2.
|
Amount Subject to
|
||||||
|---|---|---|---|---|---|---|
|
Payroll
|
Wages Due
|
Federal
|
State
|
|||
| Headquarters | $210,000 | $27,000 | $7,000 | |||
| Sales Office #1 | 57,000 | 7,000 | 2,000 | |||
| Sales Office #2 | 47,000 | 4,000 | 1,000 | |||
| Total | $314,000 | $38,000 | $10,000 |
The state unemployment tax rate is 5.5%. However, Sandhill receives a 3.5% merit adjustment, bringing its effective state unemployment rate to 2.0%. The FICA rate is 7.65% on an employee’s wages to $140,000 and 1.45% in excess of $140,000. Of the $314,000 wages potentially subject to FICA tax, the following amounts are in excess of $140,000.
| Headquarters | $21,000 | |
| Sales Office #1 | 24,000 | |
| Sales Office #2 | 19,000 |
The federal unemployment tax rate is 0.8% after credits. Income and payroll tax withheld amount to $24,000 for headquarters, $8,000 for sales office #1, and $7,700 for sales office #2.
Prepare a schedule showing the employer’s total cost of wages for November by function.
Prepare the journal entries to record the factory, sales, and administrative payrolls including the employer’s payroll taxes
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