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Payroll Accounts and Year-End Entries The following accounts, with the balances indicated, appear in the ledger of Garcon Co. on December 1 of the current

Payroll Accounts and Year-End Entries

The following accounts, with the balances indicated, appear in the ledger of Garcon Co. on December 1 of the current year:

211 Salaries Payable
212 Social Security Tax Payable $18,126
213 Medicare Tax Payable 4,770
214 Employees Federal Income Tax Payable 29,415
215 Employees State Income Tax Payable 28,620
216 State Unemployment Tax Payable 3,021
217 Federal Unemployment Tax Payable 954
218 Retirement Savings Deductions Payable 7,000
219 Medical Insurance Payable 55,300
411 Operations Salaries Expense 1,925,000
511 Officers Salaries Expense 1,256,000
512 Office Salaries Expense 320,000
519 Payroll Tax Expense 273,480

The following transactions relating to payroll, payroll deductions, and payroll taxes occurred during December:

Dec. 2 Issued Check No. 410 for $7,000 to Jay Bank to invest in a retirement savings account for employees.
2 Issued Check No. 411 to Jay Bank for $52,311 in payment of $18,126 of social security tax, $4,770 of Medicare tax, and $29,415 of employees' federal income tax due.
13 Journalized the entry to record the biweekly payroll. A summary of the payroll record follows:
Salary distribution:
Operations $89,000
Officers 56,000
Office 14,000 $159,000
Deductions:
Social security tax $9,540
Medicare tax 2,385
Federal income tax withheld 29,415
State income tax withheld 7,155
Retirement savings deductions 3,500
Medical insurance deductions 9,222 61,217
Net amount $97,783
13 Issued Check No. 420 in payment of the net amount of the biweekly payroll to fund the payroll bank account.
13 Journalized the entry to record payroll taxes on employees' earnings of December 13: social security tax, $9,540; Medicare tax, $2,385; state unemployment tax, $750; federal unemployment tax, $250.
16 Issued Check No. 424 to Jay Bank for $53,265, in payment of $19,080 of social security tax, $4,770 of Medicare tax, and $29,415 of employees' federal income tax due.
19 Issued Check No. 429 to Sims-Walker Insurance Company for $55,300, in payment of the semiannual premium on the group medical insurance policy.
27 Journalized the entry to record the biweekly payroll. A summary of the payroll record follows:
Salary distribution:
Operations $86,000
Officers 56,000
Office 14,000 $156,000
Deductions:
Social security tax $9,360
Medicare tax 2,340
Federal income tax withheld 28,548
State income tax withheld 7,020
Retirement savings deductions 3,500 50,768
Net amount $105,232
27 Issued Check No. 541 in payment of the net amount of the biweekly payroll to fund the payroll bank account.
27 Journalized the entry to record payroll taxes on employees' earnings of December 27: social security tax, $9,360; Medicare tax, $2,340; state unemployment tax, $375; federal unemployment tax, $125.
27 Issued Check No. 543 for $42,795 to State Department of Revenue in payment of employees' state income tax due on December 31.
31 Issued Check No. 545 to Jay Bank for $7,000 invest in a retirement savings account for employees.
31 Paid $84,000 to the employee pension plan. The annual pension cost is $109,000. (Record both the payment and unfunded pension liability.)

Required:

1. Journalize the transactions. For a compound transaction, if an amount box does not require an entry, leave it blank. For December 16th transactions, (a.) record the payroll and (b.) payment of salaries. For December 30th transactions, (a.) record the payroll, (b.) payment of salaries, (c.) record the taxes, and (d.) payment of taxes.

Date Account Debit Credit
2
2
13 (a.)
13 (b.)
13-Taxes
16-Taxes
19-Ins.
27 (a.)
27 (b.)
27 (c.)
27 (d.)
31-Bonds
31

2a. Journalize the following adjusting entry on December 31. Salaries accrued: operations salaries, $8,600; officers salaries, $5,600; office salaries, $1,400. The payroll taxes are immaterial and are not accrued. For a compound transaction, if an amount box does not require an entry, leave it blank.

Date Account Debit Credit
31

2b. Journalize the following adjusting entry on December 31: Vacation pay, $29,400.

Date Account Debit Credit
31

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