Juan’s Mexican Restaurants incurred salary expense of \($62,000\) for 2009. The payroll expense includes employer FICA tax of 8%, in addition to state unemployment tax of 5.4% and federal unemployment tax of 0.8%. Of the total salaries, \($19,000\) is subject to unemployment tax. Also, the company provides the following benefits for employees: health insurance (cost to the company, $2,040), life insurance (cost to the company, $380), and retirement benefits (cost to the company, 5% of salary expense).
Requirement
1.Record Juan’s expenses for employee benefits and for payroll taxes. Explanations are not required.