Chapter 11, Problem S11.6SE

To determine

Employee’s pay: The gross pay is the total earning of a period that an employee has earned. The hourly rate of pay is multiplied by the number of hours the employee has worked to determine the gross pay. Out of this gross pay, several withholdings are done with respect to various purposes like for Income tax, social security taxes etc. The gross pay net of the withholdings determines the take home pay of the employee.

To determine:

Gross pay of Lucy Rose.

To determine

Take Home pay of Lucy Rose.

Formula:

$Take Home pay = Gross Pay - Payroll tax withholdings$

Given:

$Payroll tax withholdings:$

$Income Tax withholdings \left(\$840*15\%\right) = \$126$

$Social Security taxes @ 6.2\% = \$52.08$

$Medicare Taxes @ 1.45\% = \$12.18$

To determine

3.

To determine:

Journal Entry to record wages expense and payment.