60.1K

Verified Solution

Link Copied!

The following information about the payroll for the week ended December 30 was obtained from the records of Pharrell Co.:

Salaries:
Sales salaries	$325,000
Warehouse salaries	196,000
Office salaries	131,000
	$652,000
Deductions:
Federal income tax withheld	$119,000
Social security tax withheld	39,120
Medicare tax withheld	9,780
Retirement savings	14,344
Group insurance	11,736
	$193,980
Tax rates assumed:
Social security	6%
Medicare	1.5%
State unemployment (employer only)	5.4%
Federal unemployment (employer only)	0.6%

Required:

Scroll down to access additional pages of the journal.

1.

Assuming that the payroll for the last week of the year is to be paid on December 31, journalize the following entries (refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered): a. December 30, to record the payroll. b. December 30, to record the employer's payroll taxes on the payroll to be paid on December 31. Of the total payroll for the last week of the year, $44,000 is subject to unemployment compensation taxes.

PAGE 11

JOURNAL

ACCOUNTING EQUATION

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
1
2
3
4
5
6
7
8
9
10
11
12
13
14

2.

Assuming that the payroll for the last week of the year is to be paid on January 5 of the following fiscal year, journalize the following entries (refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered):

a.

On page 11 of the journal: December 30, to record the payroll.

PAGE 11

JOURNAL

ACCOUNTING EQUATION

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
1
2
3
4
5
6
7
8
9

b.	On page 12 of the journal: January 5, to record the employers payroll taxes on the payroll to be paid on January 5. Because it is a new fiscal year, all salaries are subject to unemployment compensation taxes.

PAGE 12

JOURNAL

ACCOUNTING EQUATION

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
1
2
3
4
5

Answer & Explanation Solved by verified expert

See Answer