Cascade Company has four employees. All are paid on a monthly basis. The fiscal year of the business is June 1 to May 31. The accounts kept by Cascade include the following: Account Number Title Balance on June 1 101 Cash $67,600 211 Employee Federal Income Tax Payable 3,560 212 Social Security Tax Payable 5,119 213 Medicare Tax Payable 1,195 218 Savings Bond Deductions Payable 1,275 221 FUTA Tax Payable 568 222 SUTA Tax Payable 3,834 511 Wages and Salaries Expense 0 530 Payroll Taxes Expense 0 The following transactions relating to payrolls and payroll taxes occurred during June and July: June 15 Paid $9,874 covering the following May taxes: Social Security tax $5,119 Medicare tax 1,195 Employee federal income tax withheld 3,560 Total $9,874 30 June payroll: Total wages and salaries expense $46,000 Less amounts withheld: Social Security tax $2,852 Medicare tax 667 Employee federal income tax 3,910 Savings bond deductions 1,275 8,704 Net amount paid $37,296 30 Purchased savings bonds for employees, $2,550 30 Employer payroll taxes expenses for June were: Social Security $2,852 Medicare 667 FUTA 92 SUTA 621 Total $4,232 July 15 Paid $10,948 covering the following June taxes: Social Security tax $5,704 Medicare tax 1,334 Employee federal income tax withheld 3,910 Total $10,948 31 Paid SUTA tax for the quarter, $4,455 31 Paid FUTA tax, $660

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Cascade Company has four employees. All are paid on a monthly basis. The fiscal year of the business is June 1 to May 31.

The accounts kept by Cascade include the following:

Account Number	Title	Balance on June 1
101	Cash	$67,600
211	Employee Federal Income Tax Payable	3,560
212	Social Security Tax Payable	5,119
213	Medicare Tax Payable	1,195
218	Savings Bond Deductions Payable	1,275
221	FUTA Tax Payable	568
222	SUTA Tax Payable	3,834
511	Wages and Salaries Expense	0
530	Payroll Taxes Expense	0

The following transactions relating to payrolls and payroll taxes occurred during June and July:

June 15	Paid $9,874 covering the following May taxes:
	Social Security tax		$5,119
	Medicare tax		1,195
	Employee federal income tax withheld		3,560
	Total		$9,874
30	June payroll:
	Total wages and salaries expense		$46,000
	Less amounts withheld:
	Social Security tax	$2,852
	Medicare tax	667
	Employee federal income tax	3,910
	Savings bond deductions	1,275	8,704
	Net amount paid		$37,296
30	Purchased savings bonds for employees, $2,550
30	Employer payroll taxes expenses for June were:
	Social Security		$2,852
	Medicare		667
	FUTA		92
	SUTA		621
	Total		$4,232
July 15	Paid $10,948 covering the following June taxes:
	Social Security tax		$5,704
	Medicare tax		1,334
	Employee federal income tax withheld		3,910
	Total		$10,948
31	Paid SUTA tax for the quarter, $4,455
31	Paid FUTA tax, $660

Cash
101
Employee Federal Income Tax Payable
211
dropdown
Social Security Tax Payable
212
Medicare Tax Payable
213

Savings Bond Deductions Payable
218
FUTA Tax Payable
221
SUTA Tax Payable
222
Wages and Salaries Expense
511
Payroll Taxes Expense
530

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