I need help working out this problem! 1. Wade Industries reported the following

Question

I need help working out this problem!

1. Wade Industries reported the following information in its accounting records on December 31, 2015: The employees were paid 55,680 on December 31, 2015, but the withholdings have not yet been remitted nor have the matching employer RCA contributions. Required: Part a. Compute the total payroll costs relating to the period from December 29-31. (Assume $560 in total unemployment taxes.) Part b. Show the accounting equation effects and give the journal entries on December 31 to adjust for salaries and wages relating to December 29-31,2015. art c. Show the accounting equation effects and give the journal entries on December 31 to adjust f payroll taxes relating to December 29-31,2105.

Explanation / Answer

part a

unemployment taxes are the responsbility of emloyer and not of employee.

so payroll costs realting to period => $1940 ie incmoe atx withheld and fica contribution of both employer and employee, we will include employer contribution too even if he has not contributed yet

part b

Gross salary a/c dr. 7200

To witheld tax a/c cr. 1100

To FICA tax a/c cr. 420

To Net Salary Paid a/c cr. 5680

NOTE: all the taxex account are abalnce sheet items.

part c

on 31st december apyment of taxes to govenment been done

witheld tax a./c dr. 1100

FICA tax a/c dr. 420

To cash a/c cr. 1520

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