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FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Rahul

Transcribed Image Text:Electronics Service Company pays salaries monthly on the last day of the month. The following information is available from
Electronics for the month ended December 31, Year 1.
Administrative salaries
Sales salaries
Office salaries
Assume the Social Security tax rate is 6.0 percent on the first $110,000 of salaries. Duke reached $110,000 before September. His
salary in December amounted to $12,000 and is included in the $71,000. No one else will reach the $110,000 amount for the year.
None of the employee salaries are subject to unemployment tax in December. Assume the Medicare tax rate is 1.5% of total salaries.
Other amounts withheld from salaries in December were as follows:
Federal income tax
$ 20,000
State income tax
5,400
Employee savings plan
3,100
Required
a. Prepare the journal entry to record the payment of payroll on December 31, Year 1.
b. Prepare the journal entry to record the payroll tax expense for Electronics Service Company for December Year 1.
(If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
View transaction list
Journal entry worksheet
1
Date
12/31
2
Record the entry for payment of payroll on December 31, Year 1.
Note: Enter debits before credits.
General Journal
Administrative salaries expense
Sales salaries expense
Office salaries expense
$ 71,000
59,000
39,000
FICA tax payable-Social Security
FICA tax payable-Medicare
Employee federal income tax payable
Employee state income tax payable
Employee savings plan
Cash
Record entry
Clear entry
Debit
71,000
59,000
39,000
Credit
View general journal
>
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