Exercise 13-06 The payroll of Sheridan Company for September 2019 is as follows. Total payroll was $434,000, of which $102,000 is exempt from Social Security tax because it represented amounts paid in excess of $128,400 to certain employees. The amount paid to employees in excess of $7,000 (the maximum for both federal and state unemployment tax) was $377,000. Income taxes in the amount of $87,800 were withheld, as was $9,800 in union dues. The state unemployment tax is 3.5%, but Sheridan Company is allowed a credit of 2.3% by the state for its unemployment experience. Also, assume that the current FICA tax is.7.65% on an employee's wages to 5128,400 and 1.45% in excess of $128,400. No employee for Sheridan makes more than $135,000. The federal unemployment tax rate is 0.8% after state credit. Prepare the necessary journal entries if the wages and salaries paid and the employer payroll taxes are recorded separately. (Round answers to o decimal places, e.g. 5,275. If no entry is required, select "No Entry" for the account titles and enter o for the amounts .Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit (To record wages and salaries paid) $9,800 in union dues. The state unemployment tax is 3.5%, but Sheridan Company is allowed a credit of 2.3% by the state for its unemployment experience. Also, assume that the current FICA tax is 7.65% on an employee's wages to $128,400 and 1.45% in excess of $128,400. No employee for Sheridan makes more than $135,000. The federal unemployment tax rate is 0.8% after state credit. Prepare the necessary journal entries if the wages and salaries paid and the employer payroll taxes are recorded separately. (Round answers to o decimal places, e.g. 5,275. If no entry is required, select "No Entry" for the account titles and enter o for the amounts .Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit (To record wages and salaries pald) (To record employer payroll taxes) List of Accounts Exercise 13-06 Accounts Payable Accounts Receivable Accumulated Depreciation-Plant Assets Allowance from Expropriation Asset Retirement Obligation Cash Depreciation Expense Dividends Payable Due to Customer Discount on Notes Payable FICA Taxes Payable Freight-In FUTA Taxes Payable Insurance Premium Payable Interest Expense Interest Payable Inventory Inventory of Premiums Land Improvements Lawsuit Liability Lawsuit Loss Litigation Expense or Loss Litigation Liability Loss from Expropriation Loss on ARO Settlement No Entry Notes Payable Oil Platform Payroll Tax Expense Plant Assets Premium Expense Premium Liability Purchases Purchase Discounts Purchase Returns and Allowances Retained Earnings Salaries and Wages Expense LOS Depreciation Expense Dividends Payable Due to Customer Discount on Notes Payable FICA Taxes Payable Freight-In FUTA Taxes Payable Insurance Premium Payable Interest Expense Interest Payable Inventory Inventory of Premiums Land Improvements Lawsuit Liability Lawsuit Loss Litigation Expense or Loss Litigation Liability Loss from Expropriation Loss on ARO Settlement No Entry Notes Payable Oil Platform Payroll Tax Expense Plant Assets Premium Expense Premium Liability Purchases Purchase Discounts Purchase Returns and Allowances Retained Earnings Salaries and Wages Expense Salaries and Wages Payable Sales Revenue Sales Tax Payable SUTA Taxes Payable Trucks Unearned Sales Revenue Unearned Warranty Revenue Union Dues Payable Warranty Expense Warranty Liability Warranty Revenue Withholding Taxes Payable
