10-5

General Journal

Page 10 has 29 entries

Page 11 has 23 entries

Page 12 has 7 entries

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

Account No.	Account Name	Balance
211	Salaries Payable
212	Social Security Tax Payable	$9,270
213	Medicare Tax Payable	2,300
214	Employees Federal Income Tax Payable	15,485
215	Employees State Income Tax Payable	13,916
216	State Unemployment Tax Payable	1,310
217	Federal Unemployment Tax Payable	460
218	Bond Deductions Payable	3,000
219	Medical Insurance Payable	27,000
411	Operations Salaries Expense	930,000
511	Officers Salaries Expense	630,000
512	Office Salaries Expense	160,000
519	Payroll Tax Expense	136,351

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

On page 10 of the journal:

Dec.	2	Issued Check No. 410 for $3,000 to Jay Bank to purchase U.S. savings bonds for employees.
	2	Issued Check No. 411 to Jay Bank for $27,055 in payment of $9,270 of social security tax, $2,300 of Medicare tax, and $15,485 of employees federal income tax due.
	13	Journalized the entry to record the biweekly payroll. A summary of the payroll record follows:

Salary distribution:
Operations	$41,400
Officers	26,600
Office	6,600	$74,600
Deductions:
Social security tax	$ 4,476
Medicare tax	1,119
Federal income tax withheld	14,920
State income tax withheld	3,357
Savings bond deductions	1,500
Medical insurance deductions	4,500	(29,872)
Net amount		$44,728

	13	Issued Check No. 420 in payment of the net amount of the biweekly payroll.
	13	Journalized the entry to record payroll taxes on employees earnings of December 13: social security tax, $4,476; Medicare tax, $1,119; state unemployment tax, $360; federal unemployment tax, $125.
	16	Issued Check No. 424 to Jay Bank for $26,110, in payment of $8,952 of social security tax, $2,238 of Medicare tax, and $14,920 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.

On page 11 of the journal:

Dec.

27

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

Salary distribution:
Operations	$41,000
Officers	27,400
Office	6,800	$75,200
Deductions:
Social security tax	$ 4,512
Medicare tax	1,128
Federal income tax withheld	14,884
State income tax withheld	3,384
Savings bond deductions	1,500	(25,408)
Net amount		$49,792

	27	Issued Check No. 541 in payment of the net amount of the biweekly payroll.
	27	Journalized the entry to record payroll taxes on employees earnings of December 27: social security tax, $4,512; Medicare tax, $1,128; state unemployment tax, $210; federal unemployment tax, $80.
	27	Issued Check No. 543 for $20,657 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 $3,000 to purchase U.S. savings bonds for employees.
	31	Paid $51,000 to the employee pension plan. The annual pension cost is $68,000. (Record both the payment and unfunded pension liability.)

Required:

1.

Journalize the transactions on pages 10 and 11 of the journal.

2.

On page 12 of the journal, journalize the following adjusting entries on December 31:

a.	Salaries accrued: operations salaries, $8,530; officers salaries, $5,640; office salaries, $1,350. The payroll taxes are immaterial and are not accrued.
b.	Vacation pay, $15,300.

CHART OF ACCOUNTS

Garcon Co.

General Ledger

	ASSETS
110	Cash
111	Accounts Receivable
112	Interest Receivable
113	Notes Receivable
115	Inventory
116	Supplies
118	Prepaid Insurance
120	Land
123	Building
124	Accumulated Depreciation-Building
125	Office Equipment
126	Accumulated Depreciation-Office Equipment

	LIABILITIES
210	Accounts Payable
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	Bond Deductions Payable
219	Medical Insurance Payable
220	Interest Payable
221	Notes Payable
226	Vacation Pay Payable
227	Unfunded Pension Liability
228	Product Warranty Payable

	EQUITY
310	Common Stock
311	Retained Earnings
312	Dividends

	REVENUE
410	Sales
610	Interest Revenue

	EXPENSES
510	Cost of Goods Sold
511	Officers Salaries Expense
512	Office Salaries Expense
513	Operations Salaries Expense
519	Payroll Tax Expense
524	Depreciation Expense-Building
525	Delivery Expense
526	Repairs Expense
529	Selling Expenses
531	Rent Expense
532	Depreciation Expense-Office Equipment
533	Insurance Expense
534	Supplies Expense
536	Vacation Pay Expense
537	Pension Expense
538	Cash Short and Over
539	Product Warranty Expense
540	Miscellaneous Expense
710	Interest Expense

General Journal General Journal Instructions PAGE 12 \begin{tabular}{|c|c|c|c|c|c|c|c|c|} \hline \multicolumn{9}{|c|}{ JOURNAL } \\ \hline & DATE & DESCRIPTION & POST. REF. & DEBIT & CREDIT & ASSETS & LIABILITIES & EQUITY \\ \hline 1 & & Adjusting Entries & & & & & & \\ \hline 2 & & & & & & & & \\ \hline 3 & & & & & & & & \\ \hline 5 & & & & & & & & \\ \hline 6 & & & & & & & & \\ \hline 7 & & & & & & & & \\ \hline \end{tabular}