Question

29. Avitar Company ran Payroll on 4-30-19. On that date the column totals in its Payroll Register show that employees earned $100,000. FICA was $6,200 and, Medicare Taxes were $1,450. Federal Income Taxes withheld from employees totaled $20,000 and NJ State Taxes totaled $3,000. Employees contribute to their Healthcare Plan cost, as well as to their Pension Plan and the withholdings for these plans were 5% and 2% of total payroll respectively. Please prepare the journal entry to record payroll expenses and liabilities.

Answer 1

Journal entry for payment

Date Accounts Title and Explanation Debit Credit

4-30-19 Gross Salaries and Wages $100,000

FICA Social Security taxes $6,200

FICA Medicare $1,450

Federal income taxes / Income Tax Payable $20,000

State income tax withholding $3,000

Employee medical insurance payable/portion $5,000

of insurance premiums (100000 *5%)

Employee Pension Plan payable (100000 *2%) $2,000

Salaries and Wages Payable (Balance figure) $ 62,350

(To record payroll)

Employer payroll tax expenses journal entry

Date Accounts Title and Explanation Debit Credit

4-30-19 Employer Taxes expense $13,650

FICA Social Security taxes payable $6,200

FICA Medicare payable $1,450

FUTA payable (100000*0.6%) $600

SUTA payable (100000*5.4%) $5,400

(Being Employer's Payroll tax expenses)