Journalize Payroll Tax

The payroll register of Patel Engineering Co. indicates $1,200 of social security withheld and $300.00 of Medicare tax withheld on total salaries of $20,000 for the period. Earnings of $5,800 are subject to state and federal unemployment compensation taxes at the federal rate of 0.6% and the state rate of 5.4%.

Provide the journal entry to record the payroll tax expense for the period. If an amount box does not require an entry, leave it blank. Round to two decimal places.

Estimated Warranty Liability

Cook-Rite Co. sold $449,000 of equipment during January under a two-year warranty. The cost to repair defects under the warranty is estimated at 7% of the sales price. On August 15, a customer required a $270 part replacement, plus $127 of labor under the warranty.

Required:

(a) Provide the journal entry for the estimated warranty expense on January 31 for January sales.

Jan. 31

(b) Provide the journal entry for the August 15 warranty work. If an amount box does not require an entry, leave it blank.

Aug. 15