The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $440,000; Office...

Question

The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $440,000; Office salaries, $88,000; Federal income taxes withheld, $132,000; State income taxes withheld, $29,500; Social security taxes withheld, $32,736; Medicare taxes withheld, $7,656; Medical insurance premiums, $10,500; Life insurance premiums, $7,500; Union dues deducted, $4,500; and Salaries subject to unemployment taxes, $57,000. The employee pays 40% of medical and life insurance premiums. Assume that FICA taxes are identical to those on employees and that SUTA taxes are 5.4% and FUTA taxes are 0.6%.

1&2. Using the above information, complete the below table and prepare the journal entries to record accrued payroll and cash payment of the net payroll for July.
3. Using the above information, complete the below table.
4. Record the accrued employer payroll taxes and all other employer-paid expenses and the cash payment of all liabilities for July-assume that FICA taxes are identical to those on employees and that SUTA taxes are 5.4% and FUTA taxes are 0.6%.

 · Answer

Tabel 1 (Requirement 1)     Total premium  % paid by employees  Premium paid by employees (Total premium x 40%)  Premium paid by employer [(Total premium x (100% - 40%)]   Employee Medical Insurance Payable  $10,500  40%  $4,200  $6,300   Employee Life Insurance Payable  $7,500  40%  $3,000  $4,500    . .     2. Journal entry for accrued payroll, including employee deductions, for July    Date  General Journal  Debit  Credit    July 31 Sales Salaries  $440,000       Office Salaries  $88,000             FICA - Medicare taxes payable    $7,656           FICA - Social Sec. taxes payable    $32,736           Employee fed. Inc. taxes payable    $132,000           Employee state inc.Taxespayable    $29,500           Employee medical insurance payable      [Refer table 1]    $4,200           Employee life insurance payable              [Refer table 1]    $3,000           Employee union dues payable    $4,500           Salaries payable                                       [Refer working note 1]    $314,408        Record the cash payment of salaries:    Date  General Journal  Debit  Credit    July 31 Salaries payable  $314,408             Cash    $314,408    . .     Table 2 (Requirement 3)    Tax  Amounts Subject to Tax (a)  Tax Rate (b)  Tax Amount (a x b)   State Unemployment Taxes Payable  $57,000  5.40%  $3,078   Federal Unemployment Taxes Payable  $57,000  0.6%  $342    . .     4. Journal entries to record cash payment of all liabilities related to the July payroll.    No.  Date  General Journal  Debit  Credit    1  July 31  Payroll taxes expense                                        [Total taxes = $32,736 + $7,656 + $342 + $3,078]  $43,812               FICA - Social Sec. taxes payable    $32,736             FICA - Medicare taxes payable    $7,656             Federal unemployment taxes payable               [Refer table 2]    $342             State unemployment taxes payable                   [Refer table 2]    $3,078                     Record the employer's benefit expense    No.  Date  General Journal  Debit  Credit    2  July 31  Employee benefits expense                                   [$6,300 + $4,500]  $10,800                Employee medical insurance payable             [Refer table 1]    $6,300              Employee life insurance payable                   [Refer table 1]    $4,500                Record the cash payment of all liabilities related to the July payroll.    No.  Date  General Journal  Debit  Credit    3  July 31 FICA - Social Sec. taxes payable         [Employer contribution + Employee contribution = $32,736 + $32,736]  $65,472        FICA - Medicare taxes payable           [Employer contribution + Employee contribution = $7,656 + $7,656]  $15,312        Employee fed. Inc.Taxes payable  $132,000        Employee State. Inc. taxes payable  $29,500        Employee medical insurance payable  $10,500        Employee life insurance payable  $7,500        Employee union dues payable  $4,500        Federal unemployment taxes payable                [Refer Table 2]  $342        State unemployment taxes payable                     [Refer Table 2]  $3,078                 Cash                                                           [Refer working note 2]    $268,204    . .     Working note 1 - Computation of net salaries payable to employees      Amount  Amount    Salaries:         Sales Salaries  $440,000         Office Salaries                $88,000               Total salaries                                              (a)    $528,000    Total deductions from employee pay checks:             Employee fed. Inc. taxes payable  $132,000           Employee state inc.Taxespayable  $29,500           FICA - Social Sec. taxes payable  $32,736           FICA - Medicare taxes payable  $7,656           Employee medical insurance payable     [Refer table 1]  $4,200           Employee life insurance payable             [Refer table 1]  $3,000           Employee union dues payable  $4,500                      Total deduction                                       (b)    $213,592    Net salaries payable to employees                          (a - b)    $314,408    . .     Working note 2 - Computation of amount of cash to be paid by the employer (excluding net salaries):      Amount   FICA - Social Sec. taxes payable         [Employer contribution + Employee contribution = $32,736 + $32,736]  $65,472   FICA - Medicare taxes payable           [Employer contribution + Employee contribution = $7,656 + $7,656]  $15,312   Employee fed. Inc. taxes payable  $132,000   Employee State.Inc. taxes payable  $29,500   Employee medical insurance payable  $10,500   Employee life insurance payable  $7,500   Employee union dues payable  $4,500   Federal unemployment taxes payable                [Refer Table 2]  $342   State unemployment taxes payable                     [Refer Table 2]  $3,078    Total taxes paid in cash  $268,204   .

The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $440,000; Office...

Question:

Answers

Similar Solved Questions

. A solution containing 23 % by mass of sodium phosphate is cooled from 313 to...

Question 6 1 pts 6. What is the market value of a 5-year maturity and $1,000...

Refer to the functions r. p, and q. Find the function (1)(e) and write the domain...

A floor in an existing building has a W200 x 52 beam that spans 3 m....

Just （xiii）thanks (xi) How many different 5-card poker hands can be dealt from a regular 52-card...

You have $5,000 on a credit card that charges a 14% interest rate. If you want...

10. For H2(g) + CO2(g) ←→CO(g) + H2O(g), AH 34.78 kJ/mol at 1000 K. If Kp...

OAttem estion 4 of 14 In an aqueous solution, classify these compounds as strong acids, weak...

Tou can rearrange tus eyuduunI LO Cdicuide the actual yielu i given ute y anu meureutai...

Thunder Creek Company is preparing budgets for the first quarter of 2018. All relevant information is...

Please solve it quickly In how many ways can a 20 question true and false exam...

3. [25 marks] Some female psychology students were investigating whether intelligence depends on brain size. They each t...

How do you rationalize the denominator and simplify #(x - 42) / (sqrtx+7) - 7#?

Show math sin75/398.2=sin/200 = sin35/200=sin85/r=sin60/a a= r= We were unable to transcribe this imageWe were unable...

If the beam is subjected to a positive bending moment of M = 100 kN-m, determine...

What is the boiling point of a 2.31 m solution of naphthalene in benzene? The normal...

Tabel 1 (Requirement 1)
	Total premium	% paid by employees	Premium paid by employees (Total premium x 40%)	Premium paid by employer [(Total premium x (100% - 40%)]
Employee Medical Insurance Payable	$10,500	40%	$4,200	$6,300
Employee Life Insurance Payable	$7,500	40%	$3,000	$4,500

2. Journal entry for accrued payroll, including employee deductions, for July
Date	General Journal	Debit	Credit
July 31	Sales Salaries	$440,000
	Office Salaries	$88,000
	FICA - Medicare taxes payable		$7,656
	FICA - Social Sec. taxes payable		$32,736
	Employee fed. Inc. taxes payable		$132,000
	Employee state inc. Taxespayable		$29,500
	Employee medical insurance payable [Refer table 1]		$4,200
	Employee life insurance payable [Refer table 1]		$3,000
	Employee union dues payable		$4,500
	Salaries payable [Refer working note 1]		$314,408

Record the cash payment of salaries:
Date	General Journal	Debit	Credit
July 31	Salaries payable	$314,408
	Cash		$314,408

Table 2 (Requirement 3)
Tax	Amounts Subject to Tax (a)	Tax Rate (b)	Tax Amount (a x b)
State Unemployment Taxes Payable	$57,000	5.40%	$3,078
Federal Unemployment Taxes Payable	$57,000	0.6%	$342

4. Journal entries to record cash payment of all liabilities related to the July payroll.
No.	Date	General Journal	Debit	Credit
1	July 31	Payroll taxes expense [Total taxes = $32,736 + $7,656 + $342 + $3,078]	$43,812
		FICA - Social Sec. taxes payable		$32,736
		FICA - Medicare taxes payable		$7,656
		Federal unemployment taxes payable [Refer table 2]		$342
		State unemployment taxes payable [Refer table 2]		$3,078

Record the employer's benefit expense
No.	Date	General Journal	Debit	Credit
2	July 31	Employee benefits expense [$6,300 + $4,500]	$10,800
		Employee medical insurance payable [Refer table 1]		$6,300
		Employee life insurance payable [Refer table 1]		$4,500

Record the cash payment of all liabilities related to the July payroll.
No.	Date	General Journal	Debit	Credit
3	July 31	FICA - Social Sec. taxes payable [Employer contribution + Employee contribution = $32,736 + $32,736]	$65,472
		FICA - Medicare taxes payable [Employer contribution + Employee contribution = $7,656 + $7,656]	$15,312
		Employee fed. Inc. Taxes payable	$132,000
		Employee State. Inc. taxes payable	$29,500
		Employee medical insurance payable	$10,500
		Employee life insurance payable	$7,500
		Employee union dues payable	$4,500
		Federal unemployment taxes payable [Refer Table 2]	$342
		State unemployment taxes payable [Refer Table 2]	$3,078
		Cash [Refer working note 2]		$268,204

Working note 1 - Computation of net salaries payable to employees
	Amount	Amount
Salaries:
Sales Salaries	$440,000
Office Salaries	$88,000
Total salaries (a)		$528,000
Total deductions from employee pay checks:
Employee fed. Inc. taxes payable	$132,000
Employee state inc. Taxespayable	$29,500
FICA - Social Sec. taxes payable	$32,736
FICA - Medicare taxes payable	$7,656
Employee medical insurance payable [Refer table 1]	$4,200
Employee life insurance payable [Refer table 1]	$3,000
Employee union dues payable	$4,500
Total deduction (b)		$213,592
Net salaries payable to employees (a - b)		$314,408

Working note 2 - Computation of amount of cash to be paid by the employer (excluding net salaries):
	Amount
FICA - Social Sec. taxes payable [Employer contribution + Employee contribution = $32,736 + $32,736]	$65,472
FICA - Medicare taxes payable [Employer contribution + Employee contribution = $7,656 + $7,656]	$15,312
Employee fed. Inc. taxes payable	$132,000
Employee State. Inc. taxes payable	$29,500
Employee medical insurance payable	$10,500
Employee life insurance payable	$7,500
Employee union dues payable	$4,500
Federal unemployment taxes payable [Refer Table 2]	$342
State unemployment taxes payable [Refer Table 2]	$3,078
Total taxes paid in cash	$268,204