Question

(5 points) Total payroll of Walnut Co. was $1,900,000, of which $330,000 represented amounts paid in excess of $118,500 to certain employees. The amount paid to employees in excess of $7,000 was $1,480,000. Income taxes withheld were $461,000. The state unemployment tax is 1.2%, the federal unemployment tax is .8%, and the F.I.C.A. tax is 7.65% on an employee's salaries and wages to $118,500 and 1.45% in excess of $118,500. Prepare the journal entry for the salaries and wages paid. g

Answer 1

Kindly check Explanation

Step-by-step explanation:

Salaries and wages expense = $1,900,000

Withholding taxes payable = $461,000

Amount paid in excess of 118,500= $330,000

FICA tax = 7.65%

Excess rate = 1.45%

Salaries and wages expense --1,900,000

--- Withholding tax payable - - - - - - - 461,000

---FICA taxes payable - - - - - - - - - - - 124,890

--- Cash - - - - - - - - - - - - - - - - - - - - - - 1,314,110

FICA taxes :

((1,900,000 - 330,000)×0.0765) + (0.0145 × 330,000)

$120,105 + $4,785 = $124,890