Check Francisco Company has 20 employees, each of whom earns $3,000 per month and is paid on the last day of each month. All 20 have been employed continuously at this amount since January 1. On March 1, the following accounts and balances exist in its general ledger a. FICA-Social Security Taxes Payable, $7,440; FICA-Medicare Taxes Payable, $1,740. (The balances of these accounts represent total liabilities for both the employer's and employees' FICA taxes for the February payroll only.) b. Employees' Federal Income Taxes Payable, $15,000 (liability for February only) c. Federal Unemployment Taxes Payable, $720 (liability for January and February together). d. State Unemployment Taxes Payable, $6,480 (liability for January and February together). The company had the following payroll transactions. Mar. 15 Issued check payable to Swift Bank, a federal depository bank authorized to accept employers' payments of PICA taxes and employee income tax withholdings. The $24,180 check is in payment of the February PICA and employee income taxes. 31 Recorded the journal entry for the March salaries payable. Then recorded the cash payment of the March payroll (the company issued checks payable to each employee in payment of the March payroll). The payroll register shows the following summary totals for the March pay period. Salaries Office Salaries $ 24,000 Shop Salaries $36,000 Gross Pay $60,000 FICA Taxes. $ 3,720 $ 870 Federal Income Taxes $15,000 Net Pay $40,410 * FICA taxes are Social Security and Medicare, respectively. 31 Recorded the employer's payroll taxes resulting from the March payroll. The company has a state unemployment tax rate of 5.408 on the first $7,000 paid to each employee. The federal rate is 0.60%. Apr. 15 Issued check to Swift Bank in payment of the March PICA and employee income taxes. 15 Issued check to the State Tax Commission for the January, February, and March state unemployment taxes. Piled the check and the first quarter tax return with the Commission. 30 Issued check payable to swift Bank in payment of the employer's PUTA taxes for the first quarter of the year. 30 Piled Form 941 with the IRS, reporting the PICA taxes and the employees' federal income tax withholdings for the first quarter. Journal entry worksheet Record the employer's payroll expenses and liabilities for the month of March. Note: Enter debits before credits. Date Debit Credit Mar 31 3,720 General Journal Payroll taxes expense FICASocial sec. taxes payable FICA-Medicare taxes payable State unemployment taxes payable Federal unemployment taxes payable 870 Record entry Clear entry View general journal Record the cash payment of SUTA taxes for the months of January, February and March. Note: Enter debits before credits. Debit Credit Date Apr 15 General Journal State unemployment taxes payable Cash Record the cash payment of FUTA taxes for the first quarter of the year. Note: Enter debits before credits. Debit Credit Date Apr 30 General Journal Federal unemployment taxes payable Cash
