Calculation of Taxable Earnings and Employer Payroll Taxes, and Preparation of Journal Entry 1. Calculate the amount of taxable earnings for unemployment, Social Security, and Medicare taxes. 2. Prepare the journal entry to record the employer's payroll taxes as of October 7, 20--. Round your answers to the nearest cent. If an amount box does not require an entry, leave it blank. Selected information from the payroll register of Howard's Cutlery for the week ended October 7, 20--, is presented below. Social Security tax is 6.2% on the first $118,500 of earnings for each employee. Medicare tax is 1.45% on gross earnings. FUTA tax is 0.6% and SUTA tax is 5.4% on the first $7,000 of earnings. Taxable Earnings Employee Name Cumulative PayBefore CurrentEarnings CurrentGross Pay UnemploymentCompensation SocialSecurity Carlson, David J. $6,635 $950 Delgado, Luisa 6,150 1,215 Lewis, Arlene S. 54,375 2,415 Nixon, Robert R. 53,870 1,750 Shippe, Lance W. 24,830 1,450 Watts, Brandon Q. 117,100 2,120 Payroll taxes expense 2 Social Security tax payable 2 3 Medicare tax payable 143.55 3 4 FUTA tax payable 7.29 4 5 SUTA tax payable 65.61 5 I need to figure the taxable social security earnings and the payroll tax expense.

College Accounting, Chapters 1-27 (New in Accounting from Heintz and Parry)

22nd Edition

ISBN:9781305666160

Author:James A. Heintz, Robert W. Parry

Publisher:James A. Heintz, Robert W. Parry

Chapter9: Payroll Accounting: Employer Taxes And Reports

Section: Chapter Questions

Problem 3SEB

See similar textbooks

Related questions

Concept explainers

Question

Calculation of Taxable Earnings and Employer Payroll Taxes, and Preparation of Journal Entry

1. Calculate the amount of taxable earnings for unemployment, Social Security, and Medicare taxes.

2. Prepare the journal entry to record the employer's payroll taxes as of October 7, 20--. Round your answers to the nearest cent. If an amount box does not require an entry, leave it blank.

Selected information from the payroll register of Howard's Cutlery for the week ended October 7, 20--, is presented below. Social Security tax is 6.2% on the first $118,500 of earnings for each employee. Medicare tax is 1.45% on gross earnings. FUTA tax is 0.6% and SUTA tax is 5.4% on the first $7,000 of earnings.

Taxable Earnings
Employee Name	Cumulative Pay Before Current Earnings	Current Gross Pay	Unemployment Compensation	Social Security
Carlson, David J.		$6,635	$950
Delgado, Luisa		6,150	1,215
Lewis, Arlene S.		54,375	2,415
Nixon, Robert R.		53,870	1,750
Shippe, Lance W.		24,830	1,450
Watts, Brandon Q.		117,100	2,120

Payroll taxes expense
2	Social Security tax payable		2
3	Medicare tax payable	143.55	3
4	FUTA tax payable	7.29	4
5	SUTA tax payable	65.61	5

I need to figure the taxable social security earnings and the payroll tax expense.

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 5 steps with 4 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions