Question

P11-3B Yemi's Drug Store has four employees who are paid on an hourly basis plus time-and-a-half for all hours worked in excess of 40 a week. Payroll data for the week ended February 15, 2012, are shown below. Hours Hourly Rate Federal Income Tax United Fund Employee Worked Withholdings Contributions M. 39 $12.00 $34 $-0 Dvorska D. Mottl 42 11.00 20 10.00 L. Abbasova 44 51 5.00 10.00 A. Lee 5.00 46 10.00 36 The following tax rates are applicable: FICA 8 % , state income taxes 3 % , state unemployment taxes 5.4% , and federal unemployment 0.8 %. The first three employees are sales clerks (store wages expense). The fourth employee performs administrative duties (office wages expense). Instructions (a) Prepare a payroll register for the weekly payroll. (b) Journalize the payroll on February 15, 2012, and the accrual of employer payroll taxes. (c) Journalize the payment of the payroll on February 16, 2012 (d) Journalize the remittance to the Federal Reserve bank on February 28, 2012, of the FICA and federal income taxes payable to the government.

Answer 1

(A) Payroll register of Yemi drugs store

Employees	hours worked	Hourly rate	Regular	Overtime	Gross pay	FICA	Federal income tax
M.Dvorska	39	12	468	0	468	37.44	34
D.Mottl	42	11	462	33	495	39.60	20
L.Abbasova	44	10	440	60	500	40.00	51
A.Lee	46	20	920	180	1100	88.00	36
Totals			2290	273	2563	205.04	141

(B)

Date		particulars				Debit	Credit
Feb-15		Salaries and Wages Expense            Dr.				2,563.00
		To FICA Taxes Payable					205.04
		To Federal Income Taxes Payable					141
		To State Income Taxes Payable					76.89
		To United Fund Contributions Payable					20
		To Salaries and Wages Payable					2120.07
Feb-15		Payroll Tax Expense                    Dr.				363.946
		To FICA Taxes Payable*					205.04
		To Federal Unemployment Taxes Payable**					20.504
		To State Unemployment Taxes Payable***					138.402
(C)
Feb-16		Salaries and Wages Payable              Dr.				2120.07
		To Cash					2120.07
Feb-28		FICA Taxes Payable#                      Dr.				410.08
		Federal Income Taxes Payable				141
		To Cash					551.08
				gross pay	tax rate	amount
			*	2563	8	205.04
			**	2563	0.8	20.504
			***	2563	5.4	138.402
			#	205.04+205.04