College Accounting, Chapters 1-27 (New in Accounting from Heintz and Parry)
22nd Edition
ISBN: 9781305666160
Author: James A. Heintz, Robert W. Parry
Publisher: Cengage Learning
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Chapter 9, Problem 1CE
Total earnings for the employees of Gary’s Grill for the week ended January 14, 20--, were $6,400. The following payroll taxes were levied on these earnings:
| Social Security | 6.2% |
| Medicare | 1.45% |
| FUTA | 0.6% |
| SUTA | 5.4% |
Calculate Gary’s payroll taxes expense for the week ended January 14, 20--.
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Calculation and Journal Entry for Employer Payroll Taxes
Portions of the payroll register for La Panaderia for the week ended July 15 are shown below. The SUTA tax rate is 5.4%, and the FUTA tax rate is 0.6%, both of which are levied on the first $7,000 of earnings. The Social Security tax rate is 6.2% on the first $128,400 of earnings. The Medicare rate is 1.45% on gross earnings.
La Panaderia
Payroll Register
Total Taxable Earnings of All Employees
Total Earnings
Unemployment Compensation
Social Security
$11,300
$10,500
$11,300
1. Calculate the employer's payroll taxes expense.$
2. Prepare the journal entry to record the employer's payroll taxes expense for the week ended July 15 of the current year.
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Chapter 9 Solutions
College Accounting, Chapters 1-27 (New in Accounting from Heintz and Parry)
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