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ABC Inc. pays its employees monthly. The payroll information is listed below this is for January
2013, the first moth of ABC's fiscal year.
REQUIRED: Prepare the journal entry to record payroll for the January 2013 pay period
Salaries $80,000
Federal income taxes to be withheld 16,000
Federal unemployment tax rate 0.80%
State umemployment tax rate (after FUTA deduction) 5.40%
Social security tax rate 6.2%
Medical Tax Rate 1.45%
Solution
Journal Entry:
Date Account Title Debit($) Credit($)
Jan. 2013 Salaries Expenses A/c 80,000
Federal Income Tax Payable 16,000
Federal Unemployment Tax Rate 640
State Unemployment Tax Rate 4,320
Social Security Tax 4,960
Medical Tax 1,160
Net Payroll Payable 52,920
Jan. 2013 Net Payroll Payable A/c 52,920
Cash 52,920
ABC Inc- pays its employees monthly- The payroll information is listed.docx

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ABC Inc- pays its employees monthly- The payroll information is listed.docx

  • 1. ABC Inc. pays its employees monthly. The payroll information is listed below this is for January 2013, the first moth of ABC's fiscal year. REQUIRED: Prepare the journal entry to record payroll for the January 2013 pay period Salaries $80,000 Federal income taxes to be withheld 16,000 Federal unemployment tax rate 0.80% State umemployment tax rate (after FUTA deduction) 5.40% Social security tax rate 6.2% Medical Tax Rate 1.45% Solution Journal Entry: Date Account Title Debit($) Credit($) Jan. 2013 Salaries Expenses A/c 80,000 Federal Income Tax Payable 16,000 Federal Unemployment Tax Rate 640 State Unemployment Tax Rate 4,320 Social Security Tax 4,960 Medical Tax 1,160 Net Payroll Payable 52,920 Jan. 2013 Net Payroll Payable A/c 52,920 Cash 52,920