Entries for Payroll and Payroll Taxes

The following information about the payroll for the week ended December 30 was obtained from the records of Arnsparger Equipment Co.:

Salaries:				Deductions:
	Sales salaries	$185,000			Income tax withheld	$67,056
	Warehouse salaries	102,000			Social security tax withheld	20,574
	Office salaries	94,000			Medicare tax withheld	5,715
		$381,000			U.S. savings bonds	8,382
					Group insurance	6,858
						$108,585

Tax rates assumed:
	Social security, 6%
	Medicare, 1.5%
	State unemployment (employer only), 4.2%
	Federal unemployment (employer only), 0.8%

Required:

If an amount box does not require an entry, leave it blank.

1a. Assuming that the payroll for the last week of the year is to be paid on December 31, journalize the entry on December 30 to record the payroll.

Date	Account	Debit	Credit
Dec. 30	SelectCashEmployees Income Tax ExpenseMedicare Tax PayableSales Salaries ExpenseSales Salaries PayableItem 1
	SelectCashMedicare Tax PayableSocial Security Tax PayableWarehouse Salaries ExpenseWarehouse Salaries PayableItem 4
	SelectCashBond Deductions PayableEmployees Income Tax ExpenseOffice Salaries ExpenseOffice Salaries PayableItem 7
	SelectCashEmployees Income Tax ExpenseEmployees Income Tax PayableOffice Salaries ExpenseWarehouse Salaries ExpenseItem 10
	SelectCashSales Salaries ExpenseSocial Security Tax ExpenseSocial Security Tax PayableWarehouse Salaries ExpenseItem 13
	SelectCashMedicare Tax ExpenseMedicare Tax PayableOffice Salaries ExpenseSales Salaries ExpenseItem 16
	SelectBond Deductions ExpenseBond Deductions PayableCashOffice Salaries ExpenseWarehouse Salaries ExpenseItem 19
	SelectAccounts PayableGroup Insurance ExpenseGroup Insurance PayableOffice Salaries ExpenseSales Salaries ExpenseItem 22
	SelectAccounts ReceivableOffice Salaries ExpenseSalaries PayableSales Salaries ExpenseWarehouse Salaries ExpenseItem 25

1b. Assuming that the payroll for the last week of the year is to be paid on December 31, journalize the entry on December 30 to record the employer's payroll taxes on the payroll to be paid on December 31. Of the total payroll for the last week of the year, $19,000 is subject to unemployment compensation taxes.

Date	Account	Debit	Credit
Dec. 30	SelectFederal Unemployment Tax PayableMedicare Tax PayablePayroll Tax ExpenseSalaries ExpenseSocial Security Tax PayableItem 28
	SelectAccounts PayableFederal Unemployment Tax ExpensePayroll Tax ExpensePayroll Tax PayableSocial Security Tax PayableItem 31
	SelectCashMedicare Tax ExpenseMedicare Tax PayablePayroll Tax ExpensePayroll Tax PayableItem 34
	SelectCashOffice Salaries ExpenseSalaries PayableState Unemployment Tax ExpenseState Unemployment Tax PayableItem 37
	SelectCashFederal Unemployment Tax ExpenseFederal Unemployment Tax PayableSalaries PayableWarehouse Salaries ExpenseItem 40

2a. Assuming that the payroll for the last week of the year is to be paid on January 5 of the following fiscal year, journalize the entry on December 30 to record the payroll.

Date	Account	Debit	Credit
Dec. 30	SelectCashEmployees Income Tax ExpenseMedicare Tax PayableSales Salaries ExpenseSales Salaries PayableItem 43
	SelectCashMedicare Tax PayableSocial Security Tax PayableWarehouse Salaries ExpenseWarehouse Salaries PayableItem 46
	SelectCashBond Deductions PayableEmployees Income Tax ExpenseOffice Salaries ExpenseOffice Salaries PayableItem 49
	SelectCashEmployees Income Tax ExpenseEmployees Income Tax PayableOffice Salaries ExpenseWarehouse Salaries ExpenseItem 52
	SelectCashSales Salaries ExpenseSocial Security Tax ExpenseSocial Security Tax PayableWarehouse Salaries ExpenseItem 55
	SelectCashMedicare Tax ExpenseMedicare Tax PayableOffice Salaries ExpenseSales Salaries ExpenseItem 58
	SelectBond Deductions ExpenseBond Deductions PayableCashOffice Salaries ExpenseWarehouse Salaries ExpenseItem 61
	SelectAccounts PayableGroup Insurance ExpenseGroup Insurance PayableOffice Salaries ExpenseSales Salaries ExpenseItem 64
	SelectAccounts ReceivableOffice Salaries ExpenseSalaries PayableSales Salaries ExpenseWarehouse Salaries ExpenseItem 67

2b. Assuming that the payroll for the last week of the year is to be paid on January 5 of the following fiscal year, journalize the entry to record the employer's payroll taxes on the payroll to be paid on January 5. Since it is a new fiscal year, all $381,000 in salaries is subject to unemployment compensation taxes.

Date	Account	Debit	Credit
Jan. 5	SelectFederal Unemployment Tax PayableMedicare Tax PayablePayroll Tax ExpenseSalaries ExpenseSocial Security Tax PayableItem 70
	SelectAccounts PayableFederal Unemployment Tax ExpensePayroll Tax ExpensePayroll Tax PayableSocial Security Tax PayableItem 73
	SelectCashMedicare Tax ExpenseMedicare Tax PayablePayroll Tax ExpensePayroll Tax PayableItem 76
	SelectCashOffice Salaries ExpenseSalaries PayableState Unemployment Tax ExpenseState Unemployment Tax PayableItem 79
	SelectCashFederal Unemployment Tax ExpenseFederal Unemployment Tax PayableSalaries PayableWarehouse Salaries ExpenseItem 82