Question
Jenny Wang earns a salary of $4,000 per month during the year. Employment Insurance taxes (EI) are 1.88% of the first $49,500 in earnings. The
Jenny Wang earns a salary of $4,000 per month during the year. Employment Insurance taxes (EI) are 1.88% of the first $49,500 in earnings. The Canadian Pension Plan (CPP) rate is 4.95% of the first $53,600 in earnings, less a basic annual exemption of $3,500. During the year, $23,000 was withheld for income taxes.
Instructions
a) Generate a journal entry summarizing the payment of Wang's total salary during the year.
b) Generate a journal entry summarizing the employer's payroll tax expense on Wang's salary for the year.
c) Determine the cost of employing Wang for the year.
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