Question
Question 1: (10 Marks) Haines, Inc. prepared the following payroll summary for the current month: Administrative salaries $10,000 Sales salaries 15,000 Shop wages 21,000 Employee
Question 1: (10 Marks)
Haines, Inc. prepared the following payroll summary for the current month: Administrative salaries | $10,000 |
Sales salaries | 15,000 |
Shop wages | 21,000 |
Employee deductions: | |
Federal and provincial income taxes withheld | 11,500 |
Hospital insurance premiums | 1,430 |
Union dues | 1,190 |
CPP is 4.95% and EI is 1.73%, and none of the current month's salaries and wages exceed the CPP or EI limits. Haines makes a private pension contribution equal to 9% of each employee's gross earnings. A vacation pay accrual is also made at 4% of the gross earnings. (Ignore the CPP annual exemption for this question)
Required:
Prepare the journal entries to record:
a) The month's payroll accrual.
b) The month's employer statutory payroll costs (CPP and EI).
c) The employer's private pension contribution and vacation pay accrual.
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