The Beckett Optical Laboratory had the following payroll for the week ended February 28: Assumed tax rates
Question:
The Beckett Optical Laboratory had the following payroll for the week ended February 28:
Assumed tax rates are as follows:
a. FICA: Social Security, 6.2 percent (.062) on the first $62,700 for each employee and Medicare, 1.45 percent (.0145) on all earnings for each employee.
b. State unemployment tax, 5.4 percent (.054) on the first $7,000 for each employee.
c. Federal unemployment tax, .8 percent (.008) on the first $7,000 for each employee.
Instructions Record the following entries in general journal form:
1. The payroll entry as of February 28, assuming that Beckett uses a payroll bank account.
2. The entry to record the employer’s payroll taxes as of February 28, assuming that the total payroll is subject to the FICA tax (combined Social Security and Medicare) and that $4,760 is subject to unemployment taxes.
3. The entry to transfer cash to the Cash-Payroll Bank Account on March 2.
4. The payment of the employees on March 2.
Step by Step Answer:
College Accounting Chapters 1-26
ISBN: 9780395796993
6th Edition
Authors: Douglas J. McQuaig, Patricia A. Bille