Francisco Company has 10 employees, each of whom earns $2,700 per month and is paid on the last day of each month. All 10 have been employed continuously at this amount since January 1. On March 1, the following accounts and balances exist in its general ledger. FICA—Social Security Taxes Payable, $3,348; FICA—Medicare Taxes Payable, $784. (The balances of these accounts represent total liabilities for both the employer's and employees' FICA taxes for the February payroll only.) Employees' Federal Income Taxes Payable, $6,750 (liability for February only). Federal Unemployment Taxes Payable, $324 (liability for January and February together). State Unemployment Taxes Payable, $2,916 (liability for January and February together). The company had the following payroll transactions. Mar. 15 Issued check payable to Swift Bank, a federal depository bank authorized to accept employers' payments of FICA taxes and employee income tax withholdings. The $10,882 check is in payment of the February FICA and employee income taxes. 31 Recorded the journal entry for the March salaries payable. Then recorded the cash payment of the March payroll (the company issued checks payable to each employee in payment of the March payroll). The payroll register shows the following summary totals for the March pay period. Salaries Office Salaries Shop Salaries Gross Pay FICA Taxes* Federal Income Taxes Net Pay $ 10,800 $ 16,200 $ 27,000 $ 1,674 $ 6,750 $ 18,184 $ 392 * FICA taxes are Social Security and Medicare, respectively. 31 Recorded the employer's payroll taxes resulting from the March payroll. The company has a state unemployment tax rate of 5.40% on the first $7,000 paid to each employee. The federal rate is 0.60%. Apr. 15 Issued check to Swift Bank in payment of the March FICA and employee income taxes. 15 Issued check to the State Tax Commission for the January, February, and March state unemployment taxes. Filed the check and the first-quarter tax return with the Commission. 30 Issued check payable to Swift Bank in payment of the employer's FUTA taxes for the first quarter of the year. 30 Filed Form 941 with the IRS, reporting the FICA taxes and the employees' federal income tax withholdings for the first quarter. Required: Prepare journal entries to record these transactions and events. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field.)

Francisco Company has 10 employees, each of whom earns $2,700 per month and is paid on the last day of each month. All 10 have been employed continuously at this amount since January 1. On March 1, the following accounts and balances exist in its general ledger. FICA—Social Security Taxes Payable, $3,348; FICA—Medicare Taxes Payable, $784. (The balances of these accounts represent total liabilities for both the employer's and employees' FICA taxes for the February payroll only.) Employees' Federal Income Taxes Payable, $6,750 (liability for February only). Federal Unemployment Taxes Payable, $324 (liability for January and February together). State Unemployment Taxes Payable, $2,916 (liability for January and February together). The company had the following payroll transactions. Mar. 15 Issued check payable to Swift Bank, a federal depository bank authorized to accept employers' payments of FICA taxes and employee income tax withholdings. The $10,882 check is in payment of the February FICA and employee income taxes. 31 Recorded the journal entry for the March salaries payable. Then recorded the cash payment of the March payroll (the company issued checks payable to each employee in payment of the March payroll). The payroll register shows the following summary totals for the March pay period. Salaries Office Salaries Shop Salaries Gross Pay FICA Taxes* Federal Income Taxes Net Pay $ 10,800 $ 16,200 $ 27,000 $ 1,674 $ 6,750 $ 18,184 $ 392 * FICA taxes are Social Security and Medicare, respectively. 31 Recorded the employer's payroll taxes resulting from the March payroll. The company has a state unemployment tax rate of 5.40% on the first $7,000 paid to each employee. The federal rate is 0.60%. Apr. 15 Issued check to Swift Bank in payment of the March FICA and employee income taxes. 15 Issued check to the State Tax Commission for the January, February, and March state unemployment taxes. Filed the check and the first-quarter tax return with the Commission. 30 Issued check payable to Swift Bank in payment of the employer's FUTA taxes for the first quarter of the year. 30 Filed Form 941 with the IRS, reporting the FICA taxes and the employees' federal income tax withholdings for the first quarter. Required: Prepare journal entries to record these transactions and events. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field.)

College Accounting (Book Only): A Career Approach

13th Edition

ISBN:9781337280570

Author:Scott, Cathy J.

Publisher:Scott, Cathy J.

Chapter8: Employer Taxes, Payments, And Reports

Section: Chapter Questions

Problem 4E

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Question

FICA—Social Security Taxes Payable, $3,348; FICA—Medicare Taxes Payable, $784. (The balances of these accounts represent total liabilities for both the employer's and employees' FICA taxes for the February payroll only.)
Employees' Federal Income Taxes Payable, $6,750 (liability for February only).
Federal Unemployment Taxes Payable, $324 (liability for January and February together).
State Unemployment Taxes Payable, $2,916 (liability for January and February together).

The company had the following payroll transactions.

Mar.		15		Issued check payable to Swift Bank, a federal depository bank authorized to accept employers' payments of FICA taxes and employee income tax withholdings. The $10,882 check is in payment of the February FICA and employee income taxes.
		31		Recorded the journal entry for the March salaries payable. Then recorded the cash payment of the March payroll (the company issued checks payable to each employee in payment of the March payroll). The payroll register shows the following summary totals for the March pay period.

Salaries
Office Salaries	Shop Salaries	Gross Pay	FICA Taxes*	Federal Income Taxes	Net Pay
	$	10,800	$	16,200	$	27,000	$	1,674	$	6,750	$	18,184
							$	392

* FICA taxes are Social Security and Medicare, respectively.

	31	Recorded the employer's payroll taxes resulting from the March payroll. The company has a state unemployment tax rate of 5.40% on the first $7,000 paid to each employee. The federal rate is 0.60%.
Apr.	15	Issued check to Swift Bank in payment of the March FICA and employee income taxes.
	15	Issued check to the State Tax Commission for the January, February, and March state unemployment taxes. Filed the check and the first-quarter tax return with the Commission.
	30	Issued check payable to Swift Bank in payment of the employer's FUTA taxes for the first quarter of the year.
	30	Filed Form 941 with the IRS, reporting the FICA taxes and the employees' federal income tax withholdings for the first quarter.

Required:
Prepare journal entries to record these transactions and events. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field.)

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