Metro Media Company pays its employees monthly. Payments made by the company on October 31 follow. Cumulative amounts for the year paid to the persons prior to the October 31 payroll are also given. 1. Tori Parker, president, gross monthly salary of $20,000; gross earnings prior to October 31, $160,000. 2. Carolyn Catz, vice president, gross monthly salary of $14,000; gross earnings paid prior to October 31, $126,000. 3. Michelle Clark, independent accountant who audits the company's accounts and performs consulting services, $16,500; gross amounts paid prior to October 31, $42,500. 4. Will Wu, treasurer, gross monthly salary of $6,000; gross earnings prior to October 31, $54,000. 5. Payment to Review Services for monthly services of Tom Bradley, an editorial expert, $6,000; amount paid to Review Services prior to October 31, $30,000. Required: 1. Use an earnings ceiling of $132,900 for social security taxes and a tax rate of 6.2 percent and a tax rate of 1.45 percent on all earnings for Medicare taxes. Prepare a schedule showing the following information: a. Each employee's cumulative earnings prior to October 31. b. Each employee's gross earnings for October. c. The amounts to be withheld for each payroll tax from each employee's earnings; the employee's income tax withholdings are Parker, $5,600; Catz, $4,200; Wu, $1,320. d. The net amount due each employee. e. The total gross earnings, the total of each payroll tax deduction, and the total net amount payable to employees. 2. Prepare the general journal entry to record the company's payroll on October 31. 3. Prepare the general journal entry to record payments to employees on October 31.
Metro Media Company pays its employees monthly. Payments made by the company on October 31 follow. Cumulative amounts for the year paid to the persons prior to the October 31 payroll are also given. 1. Tori Parker, president, gross monthly salary of $20,000; gross earnings prior to October 31, $160,000. 2. Carolyn Catz, vice president, gross monthly salary of $14,000; gross earnings paid prior to October 31, $126,000. 3. Michelle Clark, independent accountant who audits the company's accounts and performs consulting services, $16,500; gross amounts paid prior to October 31, $42,500. 4. Will Wu, treasurer, gross monthly salary of $6,000; gross earnings prior to October 31, $54,000. 5. Payment to Review Services for monthly services of Tom Bradley, an editorial expert, $6,000; amount paid to Review Services prior to October 31, $30,000. Required: 1. Use an earnings ceiling of $132,900 for social security taxes and a tax rate of 6.2 percent and a tax rate of 1.45 percent on all earnings for Medicare taxes. Prepare a schedule showing the following information: a. Each employee's cumulative earnings prior to October 31. b. Each employee's gross earnings for October. c. The amounts to be withheld for each payroll tax from each employee's earnings; the employee's income tax withholdings are Parker, $5,600; Catz, $4,200; Wu, $1,320. d. The net amount due each employee. e. The total gross earnings, the total of each payroll tax deduction, and the total net amount payable to employees. 2. Prepare the general journal entry to record the company's payroll on October 31. 3. Prepare the general journal entry to record payments to employees on October 31.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:Metro Media Company pays its employees monthly. Payments made by the company on October 31 follow. Cumulative amounts for
the year paid to the persons prior to the October 31 payroll are also given.
1. Tori Parker, president, gross monthly salary of $20,000; gross earnings prior to October 31, $160,000.
2. Carolyn Catz, vice president, gross monthly salary of $14,000; gross earnings paid prior to October 31, $126,000.
3. Michelle Clark, independent accountant who audits the company's accounts and performs consulting services, $16,500; gross
amounts paid prior to October 31, $42,500.
4. Will Wu, treasurer, gross monthly salary of $6,000; gross earnings prior to October 31, $54,000.
5. Payment to Review Services for monthly services of Tom Bradley, an editorial expert, $6,000; amount paid to Review Services prior
to October 31, $30,000.
Required:
1. Use an earnings ceiling of $132,900 for social security taxes and a tax rate of 6.2 percent and a tax rate of 1.45 percent on allI
earnings for Medicare taxes. Prepare a schedule showing the following information:
a. Each employee's cumulative earnings prior to October 31.
b. Each employee's gross earnings for October.
c. The amounts to be withheld for each payroll tax from each employee's earnings; the employee's income tax withholdings are
Parker, $5,600; Catz, $4,200; Wu, $1,320.
d. The net amount due each employee.
e. The total gross earnings, the total of each payroll tax deduction, and the total net amount payable to employees.
2. Prepare the general journal entry to record the company's payroll on October 31.
3. Prepare the general journal entry to record payments to employees on October 31.
Transcribed Image Text:Req 1
Req 2 and 3
Use an earnings ceiling of $132,900 for social security taxes and a tax rate of 6.2 percent and a tax rate of 1.45 percent on all
earnings for Medicare taxes. Prepare a schedule showing the following information (Round your answers to 2 decimal
places.):
Employee
income tax
withholding
Cumulative
Social
Employee Name
Monthly pay
Medicare
Net pay
earnings
security
Totals
$
0.00 $
0.00 $
0.00 $
0.00 $
0.00 $
0.00
< Req 1
Req 2 and 3 >
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