Payroll Accounts and Year-End Entries

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

311	Salaries Payable
312	Social Security Tax Payable	$10,830
313	Medicare Tax Payable	2,850
314	Employees Federal Income Tax Payable	17,575
315	Employees State Income Tax Payable	17,100
316	State Unemployment Tax Payable	1,805
317	Federal Unemployment Tax Payable	570
318	Bond Deductions Payable	4,000
319	Medical Insurance Payable	33,100
511	Operations Salaries Expense	1,150,000
611	Officers Salaries Expense	751,000
612	Office Salaries Expense	191,000
619	Payroll Tax Expense	163,400

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

Dec. 2	Issued Check No. 210 for $4,000 to Ace Bank to purchase U.S. savings bonds for employees.
Dec. 5	Issued Check No. 211 to Ace Bank for $31,255 in payment of $10,830 of social security tax, $2,850 of Medicare tax, and $17,575 of employees' federal income tax due.
Dec. 16	Journalized the entry to record the biweekly payroll. A summary of the payroll record follows:

Salary distribution:
Operations	$52,000
Officers	34,000
Office	9,000	95,000
Deductions:
Social security tax	5,700
Medicare tax	1,425
Federal income tax withheld	17,575
State income tax withheld	4,275
Savings bond deductions	2,000
Medical insurance deductions	5,510	36,485
Net amount		58,515

Dec. 16	Issued Check No. 220 in payment of the net amount of the biweekly payroll.
Dec. 16	Journalized the entry to record payroll taxes on employees' earnings of December 16: social security tax, $5,700 ; Medicare tax, $1,425; state unemployment tax, $450; federal unemployment tax, $150.
Dec. 19	Issued Check No. 224 to Ace Bank for $31,825, in payment of $11,400 of social security tax, $2,850 of Medicare tax, and $17,575 of employees' federal income tax due.
Dec. 19	Issued Check No. 229 to Blackwood Insurance Company for $33,100, in payment of the semiannual premium on the group medical insurance policy.
Dec. 30	Journalized the entry to record the biweekly payroll. A summary of the payroll record follows:

Salary distribution:
Operations	$51,000
Officers	34,000
Office	8,000	93,000
Deductions:
Social security tax	5,580
Medicare tax	1,395
Federal income tax withheld	17,019
State income tax withheld	4,185
Savings bond deductions	2,000	30,179
Net amount		62,821

Dec. 30	Issued Check No. 341 in payment of the net amount of the biweekly payroll.
Dec. 30.	Journalized the entry to record payroll taxes on employees' earnings of December 30: social security tax, $5,580 ; Medicare tax, $1,395; state unemployment tax, $225; federal unemployment tax, $75.
Dec. 30	Issued Check No. 243 for $25,560 to State Department of Revenue in payment of employees' state income tax due on December 31.
Dec. 30	Issued Check No. 245 to Ace Bank for $4,000 to purchase U.S. savings bonds for employees.
Dec. 31	Paid $50,000 to the employee pension plan. The annual pension cost is $65,000. (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
Dec. 2	SelectAccounts PayableBond Deductions PayableCashMedical Insurance PayablePayroll ExpenseItem 1
	SelectAccounts PayableCashMedical Insurance PayablePayroll ExpenseSocial Security Tax PayableItem 3
Dec. 5	SelectCashEmployees Federal Income Tax ExpenseMedicare Tax ExpenseSocial Security Tax ExpenseSocial Security Tax PayableItem 5
	SelectCashFederal Unemployment Tax PayableMedicare Tax ExpenseMedicare Tax PayableSocial Security Tax ExpenseItem 8
	SelectEmployees Federal Income Tax ExpenseEmployees Federal Income Tax PayableFederal Unemployment Tax PayableMedicare Tax ExpenseSocial Security Tax ExpenseItem 11
	SelectCashEmployees Federal Income Tax PayableMedicare Tax PayableSocial Security Tax ExpenseSocial Security Tax PayableItem 14
Dec. 16 (a.)	SelectMedicare Tax PayableOperations Salaries ExpenseSalaries PayableSales Salaries ExpenseSales Salaries PayableItem 17
	SelectEmployees State Income Tax ExpenseOfficers Salaries ExpenseOfficers Salaries PayableSalaries PayableSocial Security Tax PayableItem 20
	SelectEmployees State Income Tax ExpenseOffice Salaries ExpenseOfficers Salaries PayableSalaries PayableSocial Security Tax PayableItem 23
	SelectCashBond Deductions PayableFederal Unemployment Tax PayableSocial Security Tax ExpenseSocial Security Tax PayableItem 26
	SelectCashMedicare Tax ExpenseMedicare Tax PayableSales Salaries ExpenseState Unemployment Tax PayableItem 29
	SelectCashEmployees Federal Income Tax ExpenseEmployees Federal Income Tax PayableOperations Salaries ExpenseSales Salaries ExpenseItem 32
	SelectAccounts PayableEmployees State Income Tax ExpenseEmployees State Income Tax PayableOfficers Salaries ExpenseState Unemployment Tax PayableItem 35
	SelectBond Deductions ExpenseBond Deductions PayableMedicare Tax ExpensePayroll Tax ExpenseSales Salaries ExpenseItem 38
	SelectAccounts PayableCashMedical Insurance ExpenseMedical Insurance PayableSales Salaries ExpenseItem 41
	SelectAccounts PayableOfficers Salaries ExpensePayroll Tax ExpenseSalaries PayableSales Salaries ExpenseItem 44
Dec. 16 (b.)	SelectAccounts PayableCashPayroll Tax ExpenseSalaries PayableSales Salaries ExpenseItem 47
	SelectAccounts PayableCashPayroll Tax ExpenseSalaries PayableSales Salaries ExpenseItem 49
Dec. 16-Taxes	SelectFederal Unemployment Tax PayableMedicare Tax PayablePayroll Tax ExpenseSalaries ExpenseSocial Security Tax PayableItem 51
	SelectAccounts PayableFederal Unemployment Tax ExpensePayroll Tax ExpensePayroll Tax PayableSocial Security Tax PayableItem 54
	SelectCashMedicare Tax ExpenseMedicare Tax PayablePayroll Tax ExpensePayroll Tax PayableItem 57
	SelectCashOffice Salaries ExpenseSalaries PayableState Unemployment Tax ExpenseState Unemployment Tax PayableItem 60
	SelectCashFederal Unemployment Tax ExpenseFederal Unemployment Tax PayableWarehouse Salaries ExpenseSalaries PayableItem 63
Dec. 19-Taxes	SelectCashPayroll Tax ExpenseSalaries PayableSocial Security Tax ExpenseSocial Security Tax PayableItem 66
	SelectAccounts PayableCashFederal Unemployment Tax ExpenseMedicare Tax ExpenseMedicare Tax PayableItem 69
	SelectAccounts PayableCashEmployees Federal Income Tax ExpenseEmployees Federal Income Tax PayableSalaries PayableItem 72
	SelectAccounts PayableCashEmployees Federal Income Tax PayableSalaries PayableSocial Security Tax PayableItem 75
Dec. 19-Ins.	SelectBond Deductions PayableCashMedical Insurance PayablePayroll ExpenseSocial Security Tax PayableItem 78
	SelectBond Deductions PayableCashMedical Insurance PayablePayroll ExpenseSocial Security Tax PayableItem 80
Dec. 30 (a.)	SelectMedicare Tax PayableOperations Salaries ExpenseSalaries PayableSales Salaries ExpenseSales Salaries PayableItem 82
	SelectEmployees State Income Tax ExpenseOfficers Salaries ExpenseOfficers Salaries PayableSalaries PayableSocial Security Tax PayableItem 85
	SelectEmployees State Income Tax ExpenseOffice Salaries ExpenseOfficers Salaries PayableSalaries PayableSocial Security Tax PayableItem 88
	SelectCashBond Deductions PayableFederal Unemployment Tax PayableSocial Security Tax ExpenseSocial Security Tax PayableItem 91
	SelectCashMedicare Tax ExpenseMedicare Tax PayableSales Salaries ExpenseState Unemployment Tax PayableItem 94
	SelectCashEmployees Federal Income Tax ExpenseEmployees Federal Income Tax PayableOperations Salaries ExpenseSales Salaries ExpenseItem 97
	SelectAccounts PayableEmployees State Income Tax ExpenseEmployees State Income Tax PayableOfficers Salaries ExpenseState Unemployment Tax PayableItem 100
	SelectBond Deductions ExpenseBond Deductions PayableMedicare Tax ExpensePayroll Tax ExpenseSales Salaries ExpenseItem 103
	SelectAccounts PayableOfficers Salaries ExpensePayroll Tax ExpenseSalaries PayableSales Salaries ExpenseItem 106
Dec. 30 (b.)	SelectAccounts PayableCashPayroll Tax ExpenseSalaries PayableSales Salaries ExpenseItem 109
	SelectAccounts PayableCashPayroll Tax ExpenseSalaries PayableSales Salaries ExpenseItem 111
Dec. 30 (c.)	SelectFederal Unemployment Tax PayableMedicare Tax PayablePayroll Tax ExpenseSalaries ExpenseSocial Security Tax PayableItem 113
	SelectAccounts PayableFederal Unemployment Tax ExpensePayroll Tax ExpensePayroll Tax PayableSocial Security Tax PayableItem 116
	SelectCashMedicare Tax ExpenseMedicare Tax PayablePayroll Tax ExpensePayroll Tax PayableItem 119
	SelectCashOffice Salaries ExpenseSalaries PayableState Unemployment Tax ExpenseState Unemployment Tax PayableItem 122
	SelectCashFederal Unemployment Tax ExpenseFederal Unemployment Tax PayableWarehouse Salaries ExpenseSalaries PayableItem 125
Dec. 30 (d.)	SelectBond Deductions PayableCashEmployees State Income Tax ExpenseEmployees State Income Tax PayablePayroll Tax ExpenseItem 128
	SelectBond Deductions PayableCashEmployees State Income Tax ExpenseEmployees State Income Tax PayablePayroll Tax ExpenseItem 130
Dec. 30-Bonds	SelectAccounts PayableBond Deductions PayableCashMedical Insurance PayablePayroll ExpenseItem 132
	SelectAccounts PayableCashMedical Insurance PayablePayroll ExpenseSocial Security Tax PayableItem 134
Dec. 31	SelectCashPension ExpenseSalaries PayableVacation Pay PayableVacation Pay ExpenseItem 136
	SelectCashPension ExpenseSalaries PayableVacation Pay PayableVacation Pay ExpenseItem 139
	SelectPension ExpenseSalaries PayableUnfunded Pension LiabilityVacation Pay PayableVacation Pay ExpenseItem 142

2a. Journalize the following adjusting entry on December 31. Salaries accrued: operations salaries, $5,100; officers salaries, $3,400; office salaries, $800. 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
Dec. 31	SelectCashOffice Salaries PayableOperations Salaries ExpenseOperations Salaries PayableUnfunded Pension LiabilityItem 145
	SelectAccounts PayableCashOffice Salaries PayableOfficers Salaries ExpenseOfficers Salaries PayableItem 148
	SelectCashOffice Salaries PayableOffice Salaries ExpenseOfficers Salaries PayableUnfunded Pension LiabilityItem 151
	SelectAccounts PayableCashSalaries PayableSales Salaries ExpenseVacation Pay ExpenseItem 154

2b. Journalize the following adjusting entry on December 31: Vacation pay, $17,500.

Date	Account	Debit	Credit
Dec. 31	SelectAccounts PayableCashUnfunded Pension LiabilityVacation Pay ExpenseVacation Pay PayableItem 157
	SelectAccounts PayableCashUnfunded Pension LiabilityVacation Pay ExpenseVacation Pay PayableItem 159