For the year ended December 31, 2008, Blasing Electrical Repair Company reports the following summary payroll data.

Blasing Company’s payroll taxes are: FICA 8%, state unemployment 2.5% (due to a stable employment record), and 0.8% federal unemployment. Gross earnings subject to FICA taxes total \($485,000,\) and unemployment taxes total \($135,000.\)

Instructions

(a) Prepare a summary journal entry at December 31 for the full year’s payroll.

(b) Journalize the adjusting entry at December 31 to record the employer’s payroll taxes.

(c) The W-2 Wage and Tax Statement requires the following dollar data.

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Gross earnings: Administrative salaries Electricians' wages Total Deductions: FICA taxes Federal income taxes withheld State income taxes withheld (3%) United Fund contributions payable Hospital insurance premiums Total $200,000 370,000 $570,000 $ 38,800 174,400 17,100 27,500 17,200 $275,000