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1. AP Company offers its employees the option of contributing retirement funds up to 5 percent of their wages, with the contribution being matched by
1. AP Company offers its employees the option of contributing retirement funds up to 5 percent of their wages, with the contribution being matched by AP. The company also pays 80 percent of medical and life insurance premiums. Company records indicate separate accounts for Social Security taxes and Medicare Taxes. Deductions and other payroll information are listed below: Wages $2,000,000 Employee contributions to voluntary retirement plans 84,000 Medical insurance premium 42,000 9,000 Life insurance premiums 400,000 Federal income taxes to be withheld 53,000 State income taxes to be withheld Federal unemployment tax rate 40 State unemployment tax rate 6.20% Social security tax rate 1.45% Medicare tax rate Required Prepare journal entries to record: a. Wage expense. b. Payroll tax expense. ends December 31 and its Fringe benefits expense
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