Reference no: EM133031294

Question: Global Sales Inc's owner Mr. Hans owns a convenience store. All the staff are paid hourly. Mr. Han's believes in keeping the employees contended with their jobs and thus is willing to give them the necessary benefits. He has 6 sales staff to assist him in his 24-hour convenience store.

Employees are allocated predefined shifts. There are times when some of the employees must take urgent leaves or must leave early or come in late - for those occasions Mr. Hans has employed two reserves to fill in those spots. Wages for all employees are all kept at the per hour rate of $16.50. Mr. Hans feels this rate is rather satisfactory.

Below are the hours clocked in by the employees for the month of March. Each staff has 44 working hours in a given week. Payroll cycle is weekly. However, the payroll cycle for the reserves would be monthly.

		1 WEEK		2 WEEKS		3 WEEKS		4 WEEKS
ON PAYROLL
SARA		44		36		44		42
ABDEL		43.5		44		43.5		44
SERAN		44		44		42		44
JOHN		42.5		40		44		44
CYNTHIA		42		44		44		43.5
MONICA		42		43.5		40		43.5
SANDRA		2		8		5.5		9.5
AZIZ		6		8		3.5		10

The following are the benefits Mr. Han's has determined for each employee.

1) Sara: She studies in the local university therefore Mr. Han's provides a tuition fee allowance. An allowance of $500 at end of every month is directly transferred to her university to help her finance her studies.

2) Abdel : He has recently just moved into Canada from Dubai. He has all the legal paperwork to be able to work in Canada. Mr. Han's currently is allowing Abdel stay in his basement till Abdel finds a reasonable accommodation. Fair market value for a one room basement suite is $650/mth.

3) Seran: He is merely working to pass his time and has recently just completed high school. Seran has no intentions to study further. He will most likely be joining his dad's business. Mr. Han's feels that no real benefit is required for Seran.

4) John: He works two jobs to support his family as such Mr. Han's pays for transit passes for him and his family of four. Transit passes for adults $85 each and for kids $35 each per month. Both kids are above 8 years of age. Passes are paid for at the beginning of the month and wants to include this benefit in the first pay cycle of every month only.

5) Cynthia and Monica: They are both roommates who have moved from Edmonton and Toronto respectively. Both of them are serving their residency in a nearby hospital in their respective fields. They require the extra income to pay off their student loans. Mr Han's had given them the loan at no cost.

Loans to each of them was $100,000 and $120,000 respectively. Prevailing interest rates for education loans are @8.6% p.a. Mr. Han's withholds $150 from each pay cheque.

Required:

1) Calculate the net actual wages payable for each employee for each pay period. Income Taxes for each pay cheque is to be assumed to be a standard of $85 for each pay period.

2) Provide journal entries for Abdel's and Cynthia's pay for the last pay cycle in the month of March.