(a)(1)
Federal Insurance Contributions Act (FICA) Tax: It is a tax applicable on employees’ earnings as a certain percentage. Employers are also supposed to contribute their share and deposit the combined amount to the federal body.
Gross Earnings: It is the amount of employee’s total earnings during a period. It includes fixed wage or salary plus overtime pay or any bonus or commission if applicable.
Net Pay: It is the amount an employee actually receives as the salary or wage payment for a particular period. It is calculated after all the statutory and voluntary deductions by the employer.
Journal Entries: Entries to record the financial transactions during each accounting period are called journal entries. Income, liabilities and the giver are credited if the balance is increased and debited if the balance is reduced Expenses, assets and the receiver is debited if the balance is increased and credited if the balance is reduced in a journal entry.
To compute: To compute the gross earnings for M.
(2)
To compute: The federal insurance contributions act taxes (FICA) on the earnings of M.
(3)
To compute: The federal income tax withheld as per the withholding table.
(4)
To compute: The state income tax withheld.
(5).
To compute: The net pay for M.
(b).
To record: The pay of M.
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Chapter 11 Solutions
Accounting Principles - Standalone book
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