1. Payroll

Liam Wallace is general manager of Moonwalk Saloon. During 2018, Wallace worked for the company earning $12,000 per month. Wallace federal income tax withheld during the month was$2,000. State Income tax was $1000, FICA tax was withheld at 7.65% of his salary. Wallace authorizes the following payroll deductions. Charity Fund contribution of 2% of his monthly salary and life insurance of $70 per month.

Moonwalk Saloon incurred payroll tax expense on Wallace for FICA tax 7.65%. The company also paid state unemployment tax of 5.4% and federal unemployment tax of .06% on the first $7,000.

Requirements:

1. Compute Liam Wallace Gross Pay and Net Pay.
2. Prepare journal entries to show:

1. Salary Expense for Wallace
2. Payroll Tax Expense for Moonwalk Saloons.
3. Payment of net pay to Wallace.
4. Payment of payroll taxes by Moonwalk Saloon.

3. How much was the total payroll expense for Moonwalk Saloon?