The following information about the weekly payroll was obtained from the records of Boltz Co.: Salaries: Sales salaries Deductions: $325,000 Income tax withheld $116,600 Warehouse salaries 200,000 U.S. savings bonds 14,674 Office salaries 142,000 Group insurance $667,000 12,006 Tax rates assumed: Social security 6% State unemployment (employer only) 5.4% Medicare 1.5% Federal unemployment (employer only) 0.8% Required: 1. Assuming that the payroll related to the first full week of the year and was paid on January 7, journalize the following entries: a. January 7, to record the payroll. b. January 7, to record the employer's payroll taxes on the payroll for the first week of the year. Since it is a new fiscal year, all $667,000 in salaries is subject to unemployment compensation taxes. 2. Assuming that the payroll related to the last week of the year and was paid on December 31, journalize the following entries: a. December 31, to record the payroll. b. December 31, to record the employer's payroll taxes on the payroll for the last week of the year. Of the total payroll for the last week of the year, $32,000 is subject to unemployment compensation taxes.

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
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The following information about the weekly payroll was obtained from the records of Boltz Co.:
Salaries:
Sales salaries
Deductions:
$325,000 Income tax withheld $116,600
Warehouse salaries 200,000 U.S. savings bonds 14,674
Office salaries
142,000 Group insurance
$667,000
12,006
Tax rates assumed:
Social security 6%
State unemployment (employer only) 5.4%
Medicare
1.5% Federal unemployment (employer only) 0.8%
Required:
1. Assuming that the payroll related to the first full week of the year and was paid on January 7, journalize the following entries:
a. January 7, to record the payroll.
b. January 7, to record the employer's payroll taxes on the payroll for the first week of the year. Since it is a new fiscal year, all $667,000 in
salaries is subject to unemployment compensation taxes.
2. Assuming that the payroll related to the last week of the year and was paid on December 31, journalize the following entries:
a. December 31, to record the payroll.
b. December 31, to record the employer's payroll taxes on the payroll for the last week of the year. Of the total payroll for the last week of the
year, $32,000 is subject to unemployment compensation taxes.
Transcribed Image Text:The following information about the weekly payroll was obtained from the records of Boltz Co.: Salaries: Sales salaries Deductions: $325,000 Income tax withheld $116,600 Warehouse salaries 200,000 U.S. savings bonds 14,674 Office salaries 142,000 Group insurance $667,000 12,006 Tax rates assumed: Social security 6% State unemployment (employer only) 5.4% Medicare 1.5% Federal unemployment (employer only) 0.8% Required: 1. Assuming that the payroll related to the first full week of the year and was paid on January 7, journalize the following entries: a. January 7, to record the payroll. b. January 7, to record the employer's payroll taxes on the payroll for the first week of the year. Since it is a new fiscal year, all $667,000 in salaries is subject to unemployment compensation taxes. 2. Assuming that the payroll related to the last week of the year and was paid on December 31, journalize the following entries: a. December 31, to record the payroll. b. December 31, to record the employer's payroll taxes on the payroll for the last week of the year. Of the total payroll for the last week of the year, $32,000 is subject to unemployment compensation taxes.
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