Question 9

Tanner's gross pay for the week is $980. His yearly pay is under the limit for OASDI. Assume that the rate for state and federal unemployment compensation taxes is 6.0%, and that Tanner's pay year-to-date has not yet exceeded the $7,000 cap. His yearly pay is under the limit for OASDI. What is the total amount of payroll taxes that his employer must record as payroll tax expenses? (Do not round your intermediate calculations. Assume a FICAOASDI Tax of 6.2% and FICAMedicare Tax of 1.45%.)

$60.76

$55.37

$133.77

$120.56

Question 10

Dan Jones and Pat Smith are two employees of Lone Star Inc. In January, 2012, Dan's gross pay was $5,500 and Pat's gross pay was $5,900. All earnings are subject to FICAOASDI Tax of 6.2% and FICAMedicare Tax of 1.45%. Which of the following would be included in the entry to record the payroll tax expense to be paid out by Lone Star Inc. for January?

a debit to FICA-OASDI for $165.30

a credit to Salary expense for $165.30

a debit to Salary payable to employees for $165.30

a credit to FICA-Medicare Tax payable