(Payroll Tax Entries) Cedarville Company pays its office employee payroll weekly. Below is a partial list of employees and their payroll data for August. Because August is their vacation period, vacation pay is also listed.

Employees	Earnings to July 31	Weekly pay	Vacation pay to be received in august
Mark Hamill	\(4,200	\)200	-
Karen Robbins	3,500	150	\(300
Brent Kirk	2,700	110	220
Alec Guinness	7,400	250	-
Ken Sprouse	8,000	330	660

Assume that the federal income tax withheld is 10% of wages. Union dues withheld are 2% of wages. Vacations are taken the second and third weeks of August by Robbins, Kirk, and Sprouse. The state unemployment tax rate is 2.5% and the federal is 0.8%, both on a \)7,000 maximum. The FICA rate is 7.65% on employee and employer on a maximum of \(118,500 per employee. In addition, a 1.45% rate is charged both employer and employee for an employee’s wages in excess of \)118,500.

Instructions

Make the journal entries necessary for each of the four August payrolls. The entries for the payroll and for the company’s liability are made separately. Also make the entry to record the monthly payment of accrued payroll liabilities.

Date

Accounts and Explanation

Debit $

Credit $

1

Salaries and wages expenses

$1,040

Withholding taxes payable

$\left(\$1040\times 10\%\right)$

$104

FICA taxes payable

$\left(\$1.040\times 7.65\%\right)$

$79.56

Union dues payable

$\left(\$1040\times 2\%\right)$

$20.8

Cash

$835.64

2

Payroll tax expenses

$94.74

FICA taxes payable

$\left(\$1,040\times 7.65\%\right)$

$79.56

FUTA taxes payable

$\left[\left(\$200+\$150+\$110\right)\times 0.8\%\right]$

$3.68

SUTA payable

$\left[\left(\$200+\$150+\$110\right)\times 2.5\%\right]$

$11.5

1

Salaries and wages payable

$590

Salaries and wages expenses

$\left(\$200+\$250\right)$

$450

Withholding taxes payable

$\left(\$1,040\times 10\%\right)$

$104

FICA taxes payable

$\left(\$1,040\times 7.65\%\right)$

$79.56

Union dues payable

$\left(\$1,040\times 2\%\right)$

$20.8

Cash

$835.64

2

Payroll tax expenses

$94.74

FICA taxes payable

data-custom-editor="chemistry" $\left(\$1,040\times 7.65\%\right)$

$79.56

FUTA taxes payable

$\left[\left(\$200+\$150+\$110\right)\times 0.8\%\right]$

$3.68

SUTA payable

$\left[\left(\$200+\$150+\$110\right)\times 2.5\%\right]$

$11.5

1

Salaries and wages expenses

$1,040

Withholding taxes payable

$\left(\$1,040\times 10\%\right)$

$104

FICA taxes payable

$\left(\$1,040\times 7.65\%\right)$

$79.56

Union dues payable

$\left(\$1,040\times 2\%\right)$

$20.8

Cash

$835.64

2

Payroll tax expenses

$94.74

FICA taxes payable

$\left(\$1,040\times 7.65\%\right)$

$79.56

FUTA taxes payable

data-custom-editor="chemistry" $\left[\left(\$200+\$150+\$110\right)\times 0.8\%\right]$

$3.68

SUTA payable

$\left[\left(\$200+\$150+\$110\right)\times 2.5\%\right]$

$11.5

1

Withholding taxes payable $\left(\$104\times 4\right)$

$416

FICA taxes payable $\left(\$79.56\times 8\right)$

$636.48

Union dues payable $\left(\$20.80\times 4\right)$

$83.2

FUTA taxes payable $\left(\$3.68\times 4\right)$

$14.72

SUTA taxes payabledata-custom-editor="chemistry" $\left(\$11.50\times 4\right)$

46

Cash

$1,196.4

$4,600.62

$4,600.62

Employees

Weekly pay

Mark Hamill

$200

Karen Robbins

150

Brent Kirk

110

Alec Guinness

250

Ken Sprouse

330

Total

$1,040

Particular

Weekly pay

Karen Robbins

$300

Brent Kirk

220

Ken Sprouse

660

Total

$1,180

No of weeks in which leaves were taken

2

Salaries and wages payable

$590