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Q8SE

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Horngren'S Financial And Managerial Accounting
Found in: Page 605

Short Answer

Macintosh Company has monthly salaries of $26,000. Assume Macintosh pays all the standard payroll taxes, no employees have reached the payroll tax limits, total income tax withheld is $2,000, and the only payroll deductions are payroll taxes. Journalize the accrual of salaries expense, accrual of employer payroll taxes, and payment of employee and employer payroll taxes for Macintosh Company.

The journal entry for the employers’ expenses and the payment of employers’ expenses are recorded.

Incomplete

See the step by step solution

Step by Step Solution

Step 1: Computation of taxes payable amount

Step 2: Journal entries

Journal

Date

Accounts and Explanation

Debit ($)

Credit ($)

Salaries and wages Expense

26,000

FICA OASDI Taxes Payable

1,612

FICA Medicare Taxes Payable

377

Federal Income taxes Payable

2,000

Salaries and wages payable

22,011

(accrual of salaries and wages expense

Salaries and wages payable

22,011

Cash

22,011

(Salaries and wages paid)

Payroll Tax Expense

5,549

FICA OASDI Taxes Payable

1,612

FICA Medicare Taxes Payable

377

Federal Income taxes Payable

2,000

Federal Unemployment taxes payable

156

State Unemployment taxes payable

1,404

(To record employer’s payroll taxes expense

FICA OASDI Taxes Payable

1,612

FICA Medicare Taxes Payable

377

Federal Income taxes Payable

2,000

Federal Unemployment taxes payable

156

State Unemployment taxes payable

1,404

Cash

5,549

(To record the payment of payroll taxes)

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