Make the necessary entry to record the payment of payroll

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Reference no: EM13745252

Below is a payroll sheet for Mahogany Company for the month of July. The company is allowed a 1% unemployment compensation rate by the state; the federal unemployment tax rate is 0.8% and the maximum for both is $7,000. Assume a 10% federal income tax rate for all employees and a 7.65% FICA tax on employee and employer on a maximum of $106,800. In addition, 1.45% is charged both employer and employee for an employee’s wages in excess of $106,800 per employee.

Name

Earnings

to June. 30

July

Earnings

Income

Tax

Withholding FICA SUTA FUTA

Jerry Kaye $ 75,000 $ 15,000

Jessie Randle 104,000 17,000

Javier White 6,000 800

Jeremy Taggle 125,000 21,000

John Jay 42,500 7,100

Joan Short 3,600 1,500

Instructions

(a) Complete the payroll sheet and make the necessary entry to record the payment of the payroll.

(b) Make the entry to record the payroll tax expenses of Mahogany Company.

(c) Make the entry to record the payment of the payroll liabilities created. Assume that the company pays all payroll liabilities at the end of each month.

Reference no: EM13745252

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