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Instructions

Columbia Industries estimated that its total payroll for the coming year would be $$355,000.$ The workers' compensation insurance premium rate is $0\mathrm{.}2\%.$

Required:

Calculate the estimated workers' compensation insurance premium and prepare the journal entry for the payment as of January $2,20--$

Assume that Columbia Industries' actual payroll for the year is $$363,000.$ Calculate the total insurance premium owed and prepare a journal entry as of December $31,20--,$ to record the adjustment for the underpayment. The actual payment of the additional premium will take place in January of the next year.

Calculations

$1$a$.$ Calculate the estimated workers' compensation insurance premium.

$2$a$.$ Assume that Columbia Industries' actual payroll for the year is $$363,000.$ Calculate the total insurance premium owed.