Question

During the month of March, Olinger Company’s employees earned wages of $65,400. Withholdings related to these wages were $5,003 for Social Security (FICA), $7,664 for federal income tax, $3,168 for state income tax, and $409 for union dues. The company incurred no cost related to these earnings for federal unemployment tax but incurred $715 for state unemployment tax.-Prepare the necessary March 31 journal entry to record salaries and wages expense and salaries and wages payable. Assume that wages earned during March will be paid during April. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)Date Account Titles and Explanation Debit CreditMar. 31 -Prepare the entry to record the company’s payroll tax expense.Date Account Titles and Explanation Debit CreditMar. 31

Answer 1

Answer and Explanation:

The journal entries are shown below:

1. Salaries and Wages Expense $65,400

To Wages Payable $49,156

To Federal Withholding Payable $7,664

To FICA Payable $5,003

To State Withholding Payable $3,168

To Union Dues Payable $409

(Being the salaries and wages expense and salaries and wages payable is recorded)

2.

Payroll Tax Expense $5,718

To FICA Payable $5,003

To State Unemployment Payable $715

(Being the payroll expense is recorded)