Ryan Company paid salaries for the month of June amounting to $240,000. Of this amount, $60,000 was received by employees who had already been paid the $285,600 maximum amount of annua earnings taxable in one year under FICA laws. Of the $240,000, a sum of $28,000 was paid to employees who had already reached the $7,000 maximum wages subject to unemployment taxes (rates 5.4 % state and 0.6 % federal). Withholding taxes amounted to $72,000, and $2,900 was withheld for investment in company stock per an agreement with employees. Required a. Prepare the journal entry to record the salary payment and the liabilities for the payroll deductions. b. Prepare the journal entry to record the employer payroll expenses. c. Prepare the journal entry to record the remittance of the taxes. • Note: Round answers to the nearest whole dollar. Date a. Jun. 30 Salary Expense Account Withholding Taxes Payable Stock Investment Payable FICA Taxes Payable Cash Dr. 240,000 0 0 0 0 Cr. 0 72,000 2,900 13,770 x 151,330 x To record salaries and related deductions. b. Jun. 30 Payroll Tax Expense 26,490 0x SUTA Taxes Payable 0 11,448 FUTA Taxes Payable 0 1,272 FICA Taxes Payable 0 13,770 x To record employer payroll taxes. c. Jun. 30 Withholding Taxes Payable 72,000 SUTA Taxes Payable 11,448 FUTA Taxes Payable 1,272 Stock Investment Payable 2,900 Cash 0 112,260 x ༦༠༠༠ཟླ To record remittance of taxes.
Ryan Company paid salaries for the month of June amounting to $240,000. Of this amount, $60,000 was received by employees who had already been paid the $285,600 maximum amount of annua earnings taxable in one year under FICA laws. Of the $240,000, a sum of $28,000 was paid to employees who had already reached the $7,000 maximum wages subject to unemployment taxes (rates 5.4 % state and 0.6 % federal). Withholding taxes amounted to $72,000, and $2,900 was withheld for investment in company stock per an agreement with employees. Required a. Prepare the journal entry to record the salary payment and the liabilities for the payroll deductions. b. Prepare the journal entry to record the employer payroll expenses. c. Prepare the journal entry to record the remittance of the taxes. • Note: Round answers to the nearest whole dollar. Date a. Jun. 30 Salary Expense Account Withholding Taxes Payable Stock Investment Payable FICA Taxes Payable Cash Dr. 240,000 0 0 0 0 Cr. 0 72,000 2,900 13,770 x 151,330 x To record salaries and related deductions. b. Jun. 30 Payroll Tax Expense 26,490 0x SUTA Taxes Payable 0 11,448 FUTA Taxes Payable 0 1,272 FICA Taxes Payable 0 13,770 x To record employer payroll taxes. c. Jun. 30 Withholding Taxes Payable 72,000 SUTA Taxes Payable 11,448 FUTA Taxes Payable 1,272 Stock Investment Payable 2,900 Cash 0 112,260 x ༦༠༠༠ཟླ To record remittance of taxes.
College Accounting (Book Only): A Career Approach
12th Edition
ISBN:9781305084087
Author:Cathy J. Scott
Publisher:Cathy J. Scott
Chapter7: Employee Earnings And Deductions
Section: Chapter Questions
Problem 3PA
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Transcribed Image Text:Ryan Company paid salaries for the month of June amounting to $240,000. Of this amount, $60,000 was received by employees who had already been paid the $285,600 maximum amount of annual
earnings taxable in one year under FICA laws. Of the $240,000, a sum of $28,000 was paid to employees who had already reached the $7,000 maximum wages subject to unemployment taxes (rates:
5.4 % state and 0.6 % federal). Withholding taxes amounted to $72,000, and $2,900 was withheld for investment in company stock per an agreement with employees.
Required
a. Prepare the journal entry to record the salary payment and the liabilities for the payroll deductions.
b. Prepare the journal entry to record the employer payroll expenses.
c. Prepare the journal entry to record the remittance of the taxes.
• Note: Round answers to the nearest whole dollar.
Date
Account
a. Jun. 30 Salary Expense
Withholding Taxes Payable
Stock Investment Payable
Dr.
240,000
Cr.
0
0
FICA Taxes Payable
Cash
0
72,000
2,900 ▼
0
13,770 x
0
151,330 X
To record salaries and related deductions.
b. Jun. 30 Payroll Tax Expense
26,490
0 ×
SUTA Taxes Payable
0
11,448
FUTA Taxes Payable
0
1,272
FICA Taxes Payable
0
13,770 x
To record employer payroll taxes.
c. Jun. 30 Withholding Taxes Payable
72,000
0
SUTA Taxes Payable
11,448
FUTA Taxes Payable
1,272
Stock Investment Payable
Cash
To record remittance of taxes.
2,900
0
0 ☑
0
0 ×
112,260 x
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