ISBN-13l 978-0-13-311741-7

HORNGREN'S ACCOUNTING - 10TH EDITION

CHP E11-19 RECORDING EMPLOYER PAYROLL TAXES

Ricardo's Mexican Restaurant incurred salaries expense of $65,000 for 2014. The payroll expense includes employer FICA tax, in addition to state unemployment tax and federal unemployment tax. Of the total salaries, $17,000 is subject to unemployment tax. Also, the company provides the following benefits for employees: health insurance (cost to the company, $2,060), life insurance (cost to the company, $350), and retirement benefits (cost to the company, 7% of salaries expense). Journalize Ricardo's expenses for employee benefits and for payroll taxes.

Payroll Tax Expense $6,026.50