Question
Alexander Wilson operates Metroplex Courier and Delivery Service. He has four employees who are paid on an hourly basis. During the workweek beginning December 15
Alexander Wilson operates Metroplex Courier and Delivery Service. He has four employees who are paid on an hourly basis. During the workweek beginning December 15 and ending December 21, 2019, his employees worked the number of hours shown below. Information about their hourly rates, marital status, and withholding allowances also appears below, along with their cumulative earnings for the year prior to the December 15-21 payroll period. Consider any hours worked beyond 40 in the week as overtime hours and overtime pay at one and one-half times their regular hourly rate. Hours Regular Marital Withholding Cumulative Employee Worked Hourly Rate Status Allowances Earnings Gloria Bahamon 47 $ 16.70 M 4 $ 32,860 Alex Garcia 43 28.50 S 1 57,300 Ron Price 49 26.90 M 3 53,972 Sara Russell 40 13.70 S 0 26,620 Compute the regular, overtime, and gross earnings for each employee. Enter the figures in the payroll register. Compute the amount of social security tax to be withheld from each employee's gross earnings. Assume a 6.2 percent social security rate on the first $122,700 earned by the employee during the year. Enter the figures in the payroll register. Compute the amount of Medicare tax to be withheld from each employee's gross earnings. Assume a 1.45 percent Medicare tax rate on all salaries and wages earned by the employee during the year. Enter the figures in the payroll register. Determine the amount of federal income tax to be withheld from each employee's total earnings. Use the tax tables in Figure 10.2a & Figure 10.2b to determine the withholding for Russell. Withholdings are $112.00 for Bahamon, $323.00 for Garcia, and $258 for Price. Enter the figures in the payroll register. Compute the net amount due each employee and enter the figures in the payroll register. Total and prove the payroll register. Bahamon and Russell are office workers. Garcia and Price are delivery workers. "Prepare a" general journal entry to record the payroll for the week ended December 21, 2019. "Prepare a" general journal entry on December 23 to summarize payment of wages for the week. Analyze: What percentage of total taxable wages was delivery wages?
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