Problem 10.2A Computing gross earnings, determining deductions, preparing payroll register, journalizing payroll transactions. LO 10-2, 10-3, 10-4, 10-5 City Place Movie Theaters has four employees and pays them on an hourly basis. During the week beginning June 24 and ending June 30, 2019, these employees worked the hours shown below. Information about hourly rates, marital status, withholding allowances, and cumulative earnings prior to the current pay period also appears below. Consider any hours worked beyond 40 in the week as overtime hours and overtime pay at one and one-half times their regular hourly rate. 1 Employee Andy Anderson Roma Benson Frank Cortez Winter Wise Regular Hours Worked 48 48 40 50 Hourly Marital Withholding Rate Status Allowances $12.70 M 11.50 M 4 11.20 M 10.70 S 2 Cumulative Earnings $17,640 16,975 16,080 14,660 1 Required: 2. Compute the regular, overtime, and gross earnings for each employee. Enter the figures in the payroll register. 3. Compute the amount of social security tax to be withheld from each employee's earnings. Assume a 6.2 percent social security rate on the first $122,700 earned by the employee during the year. Enter the figures in the payroll register. 4. Compute the amount of Medicare tax to be withheld from each employee's earnings. Assume a 1.45 percent Medicare tax rate on all salaries and wages earned by the employee during the year. Enter the figures in the payroll register. 5. Determine the amount of federal income tax to be withheld from each employee's total earnings. Use the tax tables in Figure 10.2a & Figure 10.2b. Enter the figures in the payroll register. 6. Compute the net pay of each employee and enter the figures in the payroll register. 7. Total and prove the payroll register. 8. Prepare a general journal entry to record the payroll for the week ended June 30, 2019. 9. Record the general journal entry to summarize payment of the payroll on July 3, 2019. Payroll Register General Journal Analyze Compute the regular, overtime, gross earnings, social security tax and Medicare tax to be withheld from each employee's earnings. Assume a 6.2 percent social security rate on the earned by the employee during the year. Assume a 1.45 percent Medicare tax rate on all salaries and wages earned by the employee during the year. Determine the amount of fed be withheld from each employee's total earnings. (Use the table shown in Figure 10.2A & Figure 10.2B whichever is applicable). Finally compute the net pay of each employee. intermediate calculations and final answers to 2 decimal places.) Payroll register And ending: June 30, 2019 Taxable wages Deductions Paid: July 3, 2019 Distribution Week beginning: June 24, 2019 Earnings Regular Overtime time Gross amount earnings earnings Employee Cumulative earnings Social security Medicare Social security Medicare Income tax Net amount Wages expense Andy Anderson Roma Benson Frank Cortez Winter Wise $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00
