Question

The payroll register of Konrath Co. indicates $13,200 of social security withheld and $3,300 of Medicare tax withheld on total salaries of $220,000 for the period. Earnings of $35,000 are subject to state and federal unemployment compensation taxes at the federal rate of 0.8% and the state rate of 5.4%. On December 31, provide the journal entry to record the payroll tax expense for the period.

Answer 1

December 31,

DR Payroll Tax Expense...........................................$18,670

CR Social Security Taxes Payable..........................................$13,200

Medicare Taxes Payable....................................................$3,300

Federal Unemployment Tax Payable...............................$280

State Unemployment Tax Payable...................................$1,890

Federal Unemployment tax = 0.8% * 35,000 = $280

State Unemployment tax = 5.4% * 35,000 = 1,890