The Lexington Company is a retail company that began operations on October1,2018,when it incorporated in the state of North Carolina. The Lexington Company is authorized to issue 200,000 shares of $1 par value common stock and 60,000 shares of 8%,$ 20 par value preferred stock. The company sells a product that includes a one-year warranty and records estimated warranty payable each month. Customers are charged a 6%state sales tax. The company uses a perpetual inventory system. There are three employees that are paid a monthly salary on the last day of the month.

The Lexington Company is a retail company that began operations on October 1, 2018, when it incorporated in the state of North Carolina. The Lexington Company is authorized to issue 200,000 shares of $1 par value common stock and 60,000 shares of 8%, $20 par value preferred stock. The company sells a product that includes a one-year warranty and records estimated warranty payable each month. Customers are charged a 6% state sales tax. The company uses a perpetual inventory system. There are three employees that are paid a monthly salary on the last day of the month. Following is the chart of accounts for The Lexington Company. As a new business, all beginning balances are $0. (Click the icon to view the chart of accounts.) The Lexington Company completed the following transactions during the last quarter of 2018, its first year of operations: (Click the icon to view the transactions.) Read the requirements Employee Jackson Spark McDaniel Earn. Earnings Earn. OASDI Med. Tax Ins. With. Pay $ 13,000.00 $ 6,500.00 $ 19,500.00 $ 403.00 $ 94.25 $ 1,950.00 $ 250.00 $ 2,697.25 $ 3,802.75 9,400.00 4.700.00 14,100.00 291.40 68.15 940.00 250.00 1,549.55 3,150.45 5,000.00 2,500.00 7,500.00 155.00 36.25 375.00 250.00 816.25 1,683.75 $ 27,400.00 $ 13,700.00 $ 41,100.00 $ 849.40 $ 198.65 $ 3,265.00 $ 750.00 $ 5,063.05 $ 8,636.95 Requirement 1c. In preparation for recording the transactions, prepare: Calculations for employer payroll taxes liabilities for October, November, and December: OASDI: 6.2% on first $118,500 earned; Medicare: 1.45%; SUTA: 5.4% on first $7,000 earned; FUTA: 0.6% on first $7,000 earned. (Round your answers to the nearest cent) Begin by preparing the calculations for employer payroll taxes liabilities for October Tax Amount OASDI Taxable Earnings $ 13,700.00 $ 13,700.00 849.40 Medicare 198.65 SUTA 13,700.00 739.80 82.20 FUTA 13,700.00 1,870.05 Next, prepare the calculations for employer payroll taxes liabilities for November. Tax OASDI Taxable Earnings 13700 13700 Amount 849.40 198.65 Medicare SUTA FUTA Enter any number in the edit fields and then click Check Answer. ? - More Info Data Table Oct. 1 Issued 28,000 shares of $1 par value common stock for cash of $8 per share. Issued a $190,000, 10-year, 12% mortgage payable for land with an existing store building. Mortgage payments of $2,375 are due on the first day of each month, beginning November Oct. 1 1. The assets had the following market values: Land, $110,000; Building, $80,000. Issued a one-year, 15% note payable for $12,000 for store fixtures. The principal and Oct. 1 interest are due October 1, 2019. Oct. 3 Purchased merchandise inventory on account from Top Notch for $134,000, terms n/30. Oct. 15 Paid $150 for utilities. Recorded cash sales for the month of $160,000 plus sales tax of 6%. The cost of the Oct. 31 goods sold was $96,000 and estimated warranty payable was 9%. Oct. 31 Recorded October payroll and paid employees. Oct. 31 Accrued employer payroll taxes for October. Nov. 1 Paid the first mortgage payment. Nov. 3 Paid Top Notch for the merchandise inventory purchased on October 3. Nov. 10 Purchased merchandise inventory on account from Top Notch for $130,000, terms n/30 Nov. 12 Purchased 1,000 shares of treasury stock for $11 per share. Nov. 15 Paid all liabilities associated with the October 31 payroll. Nov. 15 Remitted (paid) sales tax from October sales to the state of North Carolina. Nov. 16 Paid $5,000 to satisfy warranty claims. Nov. 17 Declared cash dividends of $1 per outstanding share of common stock. Nov. 18 Paid $325 for utilities Nov. 27 Paid the cash dividends. Recorded cash sales for the month of $200,000 plus sales tax of 6%. The cost of the Nov. 30 goods sold was $120,000 and estimated warranty payable was 9%. Nov. 30 Recorded November payroll and paid employees. Nov. 30 Accrued employer payroll taxes for November. Dec. 1 Paid the second mortgage payment. The Tusquittee Company Chart of Accounts Cash Dividends Payable-Common Merchandise Inventory Notes Payable Land Mortgages Payable Building Common Stock$1 Par Value Store Fixtures Paid-in Capital in Excess of ParCommon Accumulated Depreciation Paid-in Capital from Treasury Stock Transactions Accounts Payable Retained Earnings Employee Income Taxes Payable Treasury Stock-Common FICAOASDI Taxes Payable Cash Dividends FICA-Medicare Taxes Payable Sales Revenue Employee Health Insurance Payable Cost of Goods Sold Federal Unemployment Taxes Payable Salaries Expense State Unemployment Taxes Payable Payroll Tax Expense Income Tax Payable Utilities Expense Sales Tax Payable Depreciation Expense Estimated Warranty Payable Warranty Expense Interest Payable Income Tax Expense Interest Expense Print Done Print Done The Lexington Company is a retail company that began operations on October 1, 2018, when it incorporated in the state of North Carolina. The Lexington Company is authorized to issue 200,000 shares of $1 par value common stock and 60,000 shares of 8%, $20 par value preferred stock. The company sells a product that includes a one-year warranty and records estimated warranty payable each month. Customers are charged a 6% state sales tax. The company uses a perpetual inventory system. There are three employees that are paid a monthly salary on the last day of the month. Following is the chart of accounts for The Lexington Company. As a new business, all beginning balances are $0. (Click the icon to view the chart of accounts.) The Lexington Company completed the following transactions during the last quarter of 2018, its first year of operations: (Click the icon to view the transactions.) Read the requirements Employee Jackson Spark McDaniel Earn. Earnings Earn. OASDI Med. Tax Ins. With. Pay $ 13,000.00 $ 6,500.00 $ 19,500.00 $ 403.00 $ 94.25 $ 1,950.00 $ 250.00 $ 2,697.25 $ 3,802.75 9,400.00 4.700.00 14,100.00 291.40 68.15 940.00 250.00 1,549.55 3,150.45 5,000.00 2,500.00 7,500.00 155.00 36.25 375.00 250.00 816.25 1,683.75 $ 27,400.00 $ 13,700.00 $ 41,100.00 $ 849.40 $ 198.65 $ 3,265.00 $ 750.00 $ 5,063.05 $ 8,636.95 Requirement 1c. In preparation for recording the transactions, prepare: Calculations for employer payroll taxes liabilities for October, November, and December: OASDI: 6.2% on first $118,500 earned; Medicare: 1.45%; SUTA: 5.4% on first $7,000 earned; FUTA: 0.6% on first $7,000 earned. (Round your answers to the nearest cent) Begin by preparing the calculations for employer payroll taxes liabilities for October Tax Amount OASDI Taxable Earnings $ 13,700.00 $ 13,700.00 849.40 Medicare 198.65 SUTA 13,700.00 739.80 82.20 FUTA 13,700.00 1,870.05 Next, prepare the calculations for employer payroll taxes liabilities for November. Tax OASDI Taxable Earnings 13700 13700 Amount 849.40 198.65 Medicare SUTA FUTA Enter any number in the edit fields and then click Check Answer. ? - More Info Data Table Oct. 1 Issued 28,000 shares of $1 par value common stock for cash of $8 per share. Issued a $190,000, 10-year, 12% mortgage payable for land with an existing store building. Mortgage payments of $2,375 are due on the first day of each month, beginning November Oct. 1 1. The assets had the following market values: Land, $110,000; Building, $80,000. Issued a one-year, 15% note payable for $12,000 for store fixtures. The principal and Oct. 1 interest are due October 1, 2019. Oct. 3 Purchased merchandise inventory on account from Top Notch for $134,000, terms n/30. Oct. 15 Paid $150 for utilities. Recorded cash sales for the month of $160,000 plus sales tax of 6%. The cost of the Oct. 31 goods sold was $96,000 and estimated warranty payable was 9%. Oct. 31 Recorded October payroll and paid employees. Oct. 31 Accrued employer payroll taxes for October. Nov. 1 Paid the first mortgage payment. Nov. 3 Paid Top Notch for the merchandise inventory purchased on October 3. Nov. 10 Purchased merchandise inventory on account from Top Notch for $130,000, terms n/30 Nov. 12 Purchased 1,000 shares of treasury stock for $11 per share. Nov. 15 Paid all liabilities associated with the October 31 payroll. Nov. 15 Remitted (paid) sales tax from October sales to the state of North Carolina. Nov. 16 Paid $5,000 to satisfy warranty claims. Nov. 17 Declared cash dividends of $1 per outstanding share of common stock. Nov. 18 Paid $325 for utilities Nov. 27 Paid the cash dividends. Recorded cash sales for the month of $200,000 plus sales tax of 6%. The cost of the Nov. 30 goods sold was $120,000 and estimated warranty payable was 9%. Nov. 30 Recorded November payroll and paid employees. Nov. 30 Accrued employer payroll taxes for November. Dec. 1 Paid the second mortgage payment. The Tusquittee Company Chart of Accounts Cash Dividends Payable-Common Merchandise Inventory Notes Payable Land Mortgages Payable Building Common Stock$1 Par Value Store Fixtures Paid-in Capital in Excess of ParCommon Accumulated Depreciation Paid-in Capital from Treasury Stock Transactions Accounts Payable Retained Earnings Employee Income Taxes Payable Treasury Stock-Common FICAOASDI Taxes Payable Cash Dividends FICA-Medicare Taxes Payable Sales Revenue Employee Health Insurance Payable Cost of Goods Sold Federal Unemployment Taxes Payable Salaries Expense State Unemployment Taxes Payable Payroll Tax Expense Income Tax Payable Utilities Expense Sales Tax Payable Depreciation Expense Estimated Warranty Payable Warranty Expense Interest Payable Income Tax Expense Interest Expense Print Done Print Done