The following accounts, with the balances indicated, appear in the ledger of Garcon Co. on December 1 of the current year:

The following transactions relating to payroll, payroll deductions, and payroll taxes occurred during December:

Dec. 2. Issued Check No. 410 for $3,400 to Jay Bank to invest in a retirement savings account for employees.

2. Issued Check No. 411 to Jay Bank for $27,046, in payment of $9,273 of social security tax, $2,318 of Medicare tax, and $15,455 of employees’ federal income tax due.

13. Journalized the entry to record the biweekly payroll. A summary of the payroll record follows:

Dec. 13. Issued Check No. 420 in payment of the net amount of the biweekly payroll to fund the payroll bank account.

13. Journalized the entry to record payroll taxes on employees’ earnings of December

13: social security tax, $4,632; Medicare tax, $1,158; state unemployment tax, $350; federal unemployment tax, $125.

16. Issued Check No. 424 to Jay Bank for $27,020, in payment of $9,264 of social security tax, $2,316 of Medicare tax, and $15,440 of employees’ federal income tax due.

19. Issued Check No. 429 to Sims-Walker Insurance Company for $31,500, in payment of the semiannual premium on the group medical insurance policy.

27. Journalized the entry to record the biweekly payroll. A summary of the payroll record follows:

27. Issued Check No. 541 in payment of the net amount of the biweekly payroll to fund the payroll bank account.

27. Journalized the entry to record payroll taxes on employees’ earnings of December

27: social security tax, $4,668; Medicare tax, $1,167; state unemployment tax, $225; federal unemployment tax, $75.

27. Issued Check No. 543 for $20,884 to State Department of Revenue in payment of employees’ state income tax due on December 31.

31. Issued Check No. 545 to Jay Bank for $3,400 to invest in a retirement savings account for employees.

31. Paid $45,000 to the employee pension plan. The annual pension cost is $60,000. (Record both the payment and unfunded pension liability.)

Instructions

1. Journalize the transactions.

2. Journalize the following adjusting entries on December 31:

a. Salaries accrued: operations salaries, $8,560; officers salaries, $5,600; office salaries, $1,400. The payroll taxes are immaterial and are not accrued.

b. Vacation pay, $15,000.

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211 Salaries Payable 212 Social Security Tax Payable 213 Medicare Tax Payable 214 Employees Federal Income Tax Payable 215 Employees State Income Tax Payable 216 State Unemployment Tax Payable 217 Federal Unemployment Tax Payable 218 Retirement Savings $ 9,273 Deductions Payable $ 3,400 219 Medical Insurance Payable 411 Operations Salaries Expense 511 Officers Salaries Expense 512 Office Salaries Expense 519 Payroll Tax Expense 2,318 27,000 15,455 950,000 13,909 600,000 1,400 150,000 500 137,951