Business, 12.10.2020 14:01 Afranker8778

The payroll of YellowCard Company for September 2013 is as follows. Total payroll was $464,000, of which $118,000 is exempt from Social Security tax because it represented amounts paid in excess of $128,400 to certain employees. The amount paid to employees in excess of $7,000 (the maximum for both federal and state unemployment tax) was $418,000. Income taxes in the amount of $86,000 were withheld, as was $8,500 in union dues. The state unemployment tax is 3.5%, but Sandhill Company is allowed a credit of 2.3% by the state for its unemployment experience. Also, assume that the current FICA tax is 7.65% on an employee’s wages to $128,400 and 1.45% in excess of $128,400. No employee for Sandhill makes more than $135,000. The federal unemployment tax rate is 0.8% after state credit.

Required:
Prepare the necessary journal entries if:

a. The wages and salaries paid.
b. The employer payroll taxes are recorded separately.

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The payroll of YellowCard Company for September 2013 is as follows. Total payroll was $464,000, of...