Final answer:
To determine the payroll tax expense for BMS, multiply the gross payroll by the total of the employer's Social Security and Medicare tax rates, which is typically 15.3%. This will give the debit amount for payroll taxes for the month of January.
Step-by-step explanation:
Calculating Payroll Tax Expense
To calculate the debit to payroll tax expense for Barbara Muller Services (BMS), one would need to know the gross payroll amount and the applicable tax rates. Payroll taxes typically include Social Security and Medicare taxes, which in the US are collectively known as Federal Insurance Contributions Act (FICA) taxes. For the purpose of this example, let's assume the Social Security tax rate is 6.2% and the Medicare tax rate is 1.45% of the gross payroll, which are the standard rates as of my last knowledge update.
Employers are required to match these contributions for each employee, meaning the combined payroll tax expense for the employer is 12.4% for Social Security and 2.9% for Medicare. To calculate the actual expense, multiply the gross payroll by the total tax rate (15.3%) to determine the employer's monthly payroll tax liability. This figure represents the payroll tax expense that BMS would debit in its accounting records for the month of January.