Question

Pearl Hardware payroll for November 2020 is summarized below.

					Amount Subject to Payroll Taxes
						Unemployment Tax
Payroll		Wages Due		FICA		Federal		State
Factory		$128,000		$128,000		$42,900		$42,900
Sales		32,600		32,600		3,700		3,700
Administrative		36,300		36,300
Total		$196,900		$196,900		$46,600		$46,600

At this point in the year, some employees have already received wages in excess of those to which payroll taxes apply. Assume that the state unemployment tax is 2.5%. The FICA rate is 7.65% on an employee’s wages to $128,400 and 1.45% in excess of $128,400. Of the $196,900 wages subject to FICA tax, $20,700 of the sales wages is in excess of $128,400. Federal unemployment tax rate is 0.8% after credits. Income tax withheld amounts to $15,000 for factory, $7,500 for sales, and $6,600 for administrative.

Prepare a schedule showing the employer's total cost of wages for November by function. (Round answers to 0 decimal places, e.g. 5,275.) Factory Sales Administrative Total Salaries and Wages & FICA Taxes FUTA Taxes SUTA Taxes Total Cost

Answer 1

Preparation of schedule showing the employer's total cost of wages for Nov by function and preparation of journal entries for factory payroll, sales payroll and administrative payroll.

Refer the below images for more detailed solution with calculations.

solution : employer's Requirement @ : prepare total cost of wages a for schedule Showing the November by fonction: § 1210* $ 30 & 93 1073 4 * calculation of taxes : particolars Factory sales Wages $ 128000 $32600 Social Security taxes (FICA) & 9792 (7.65 of 4 8 128000 = $ 9:792) Federal unemployment taxes $ 343 ($42900 X 0.8% = 1743) ($3700* 0-810 = 30) State unemployment taxes ($ 42900 7 2051 241073) ($ 3700 *-*-493) $139208 33933 Total cost (132600-$20700) + $ 207007 1.454- working):* & 11900 47.65.1 =$910 + $ 300 = $ 1210 Given that of $ 196900 wages subject to FECA tax $20700 of the Sales wages is in excess of $ 128400. Therefore, $20700 charged by inexcess of $122400 (1-2, 1045-) and remaining sales wage & 11000 Cie $32.600-$20000] charged by 7.650.

Particulars Administrative 9 36300 2777 Wages Social Security taxes (FICA) ( 36300 * 7.65-1. - 2797) Federal unemployment taxes State unemployment taxes Total cost 839077 Schedule Administrative Toral particulars Sales Factory Salaries & wages FICA Taxes FUTA Taxes SUTA Taxis S 36300 $ 2777 $ 128000 $ 9792 $ 343 $ 1073 $32600 1210 $ 30 $ 196900 $ 13729 $ 373 $ 93 $ 1166 $212218 Total cost $139208 $33933 439077 (redit Requirement : Journal entries (Factory payroll) particulars -Debit salaries & wages expense Alc Dr $ 128000 To with holding taxes payable (given) TO FICA taxes payable To cash (balacing figure) (Being to record salaries & wages exponse) $ 15000 $9792 $103208 $11208 payroll Tax expense Alc. Dr TO FICA Taxes payable TO FUTA Taxes payable To SUTA Taxes payable (Being to record payroll tax expense) 49792 & 343 { 1073

Journal entries ( sales payroll): Credit particolars Debit Salaries wages expense ale or * 32600 To with holding fares payable (give) TO FICA tares payable To cast (balancing figure) (Being to record Salaries & wages experse) & 75oo T1210 238१० $ 1333 payroll tax expense All or To fica taxes payable. TO FUTA tares payable To sura tares payable (Being to record payroll tax expense) $1210 1 30 $93 Journal entries (Administrative payrole): particulars Debit Credit # $ 36300 Salaries & wages exponse Allc or To withholding taxes payable (given) To Fica daxes payable so cash (balanging figure) (Being to record salaries & wages expense) $ 6600 $ 2777 $26923 payroll 2777 tar expense ale or TO FICA tares payable to record payroll tax expense) $ 2777 (Being