Maddie Inc. pays their employees semi-monthly. Payroll is subject to social security tax of 6% and Medicare tax of 1.5%, with no maximum earnings; $10,000 is subject to state unemployment tax of 5.4% and federal unemployment tax of 0.8%. Prepare the adjusting journal entries for payroll assuming the employees are paid on January 5th for the pay period ended December 31, 2021.

Salary expense $120,000

Federal income tax withheld 20,000

Maddie provides its employees with varying amounts of vacation per year, depending on the length of employment. The estimated amount of the current years vacation pay is $78,000.

Maddie also provides a pension plan that requires a contribution by the employer equal to 9% of employee salaries.