Exercise 10.5 ★ ACCOUNTING FOR THE PAYROLL AND ACCRUAL OF WAGES AND SALARIES Lavender plc pays its employees on a fortnightly basis. All employee benefi ts are recognised as expenses. The following information is provided for its July and August payrolls: July August ££££ Fortnightly payroll 580 000 720 000 700 000 600 000 Gross payroll for the month Deductions payable to: Taxation authority Health fund Community charity Union fees 250 000 20 000 4 000 6 500 1 300 000 245 000 20 000 4 000 6 500 1 300 000 Total deductions for the month Net wages and salaries paid 14 July, 11 August 458 775 280 500 553 230 275 500 28 July, 25 August 560 725 1 019 500 471 270 1 024 500 1 300 000 1 300 000 The two fortnightly payrolls in August were for the fortnight ended Friday 7 August and Friday 21 August. The payrolls were processed and paid on the following Monday and Tuesday respectively. Payroll deductions are remitted as follows: Health fund deductions Union fees Taxation authority Community charity 3rd day of the following month 3rd day of the following month 15th day of the following month 21st day of the following month Required 1. Prepare all journal entries to account for the August payroll and all payments relating to employee benefi ts during August. 2. Prepare a journal entry to accrue wages for the remaining days in August not included in the fi nal August payroll. Use the same level of remuneration as per the fi nal payroll for August.