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
Solution
Journal Entry:
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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