Emily Turnbull, president of Aerobic Equipment Corporation, is concerned about her employees’ well-being. The company offers its employees free medical, dental, and life insurance coverage. It also matches employee contributions to a voluntary retirement plan up to 6% of their salaries. Assume that no employee’s cumulative wages exceed the relevant wage bases. Payroll information for the biweekly payroll period ending January 24 is listed below.Wages and salaries $2,500,000Employee contribution to voluntary retirement plan 125,000Medical insurance premiums paid by employer 50,000Dental insurance premiums paid by employer 17,500Life insurance premiums paid by employer 8,750Federal and state income tax withheld 537,500FICA tax rate 7.65%Federal and state unemployment tax rate 6.20%Required:1. Record the employee salary expense, withholdings, and salaries payable.2. Record the employer-provided fringe benefits.3. Record the employer payroll taxes.
Emily Turnbull, president of Aerobic Equipment Corporation, is concerned about her employees’ well-being. The company offers its employees free medical, dental, and life insurance coverage. It also matches employee contributions to a voluntary retirement plan up to 6% of their salaries. Assume that no employee’s cumulative wages exceed the relevant wage bases. Payroll information for the biweekly payroll period ending January 24 is listed below.
Wages and salaries $2,500,000
Employee contribution to voluntary retirement plan 125,000
Medical insurance premiums paid by employer 50,000
Dental insurance premiums paid by employer 17,500
Life insurance premiums paid by employer 8,750
Federal and state income tax withheld 537,500
FICA tax rate 7.65%
Federal and state
Required:
1. Record the employee salary expense, withholdings, and salaries payable.
2. Record the employer-provided
3. Record the employer payroll taxes.
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