Question

Beth Corbin's regular hourly wage rate is $14, and she receives an hourly rate of $21 for work in excess of 40 hours. During a January pay period, Beth works 50 hours. Beth's federal income tax withholding is $98, she has no voluntary deductions, and the FICA tax rate is 7.65%. Use January 15 for the end of the pay period and the payment date.

Prepare the journal entries to record:

a. Beth's pay for the period.
b. The payment of Beth's wages.

Answer 1

a.

Jan 15

DR Salaries and Wages $770

CR Federal Income tax payable $98

CR FICA taxes payable $58.91

CR Salaries and wages payable $613.09

Working.

Beth's gross pay = (14 * 40 hours) + (21 * 10 extra hours above the 40)

= 560 + 210

= $770

FICA Taxes = 770 * 7.65%

= $58.91

b.

Jan 15

DR Salaries and Wages payable $613.09

CR Cash $613.09