For the year ended December 31, 2014, Denkinger Electrical Repair Company reports the following summary payroll data.
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Gross earnings: |
|
|
Administrative salaries |
$200,000 |
|
Electricians” wages |
370,000 |
|
Total |
$570,000 |
|
Deductions: |
|
|
FICA taxes |
$ 38,645 |
|
Federal income taxes withheld |
174,400 |
|
State income taxes withheld (3%) |
17,100 |
|
United Fund contributions payable |
27,500 |
|
Health insurance premiums |
17,200 |
|
Total |
$274,845 |
Denkinger Company”s payroll taxes are Social Security tax 6.2%, Medicare tax 1.45%, state unemployment 2.5% (due to a stable employment record), and 0.8% federal unemployment. Gross earnings subject to Social Security taxes of 6.2% total $490,000, and gross earnings subject to unemployment taxes total $135,000.
Instructions
(a)Prepare a summary journal entry at December 31 for the full year”s payroll.
(b)Journalize the adjusting entry at December 31 to record the employer”s payroll taxes.
(c)The W-2 Wage and Tax Statement requires the following dollar data.
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Wages,Tips, |
Federal Income |
State Income |
FICA Wages |
FICA Tax |
|
Other Compensation |
Tax Withheld |
Tax Withheld |
Wages |
Withheld |
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Complete the required data for the following employees. |
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Employee |
Gross Earnings |
Federal Income Tax Withheld |
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|
Maria Sandoval |
$59,000 |
$28,500 |
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|
Jennifer Mingenback |
26,000 |
10,200 |
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