Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The payroll of Ivanhoe Company for September 2019 is as follows. Total payroll was $508,000, of which $104,000 is exempt from Social Security tax because

The payroll of Ivanhoe Company for September 2019 is as follows. Total payroll was $508,000, of which $104,000 is exempt from Social Security tax because it represented amounts paid in excess of $128,400 to certain employees. The amount paid to employees in excess of $7,000 (the maximum for both federal and state unemployment tax) was $365,000. Income taxes in the amount of $77,300 were withheld, as was $9,900 in union dues. The state unemployment tax is 3.5%, but Ivanhoe Company is allowed a credit of 2.3% by the state for its unemployment experience. Also, assume that the current FICA tax is 7.65% on an employees wages to $128,400 and 1.45% in excess of $128,400. No employee for Ivanhoe makes more than $135,000. The federal unemployment tax rate is 0.8% after state credit. Prepare the necessary journal entries if the wages and salaries paid and the employer payroll taxes are recorded separately.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting Tools For Business Decision Making

Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso

2nd Edition

0471347744, 978-0471347743

More Books

Students also viewed these Accounting questions

Question

What research interests does the faculty member have?

Answered: 1 week ago

Question

3.2 Discuss the strategic importance of technology in HRM.

Answered: 1 week ago