Need help with journalizing this: Received the following data on the monthly pay
ID: 2501864 • Letter: N
Question
Need help with journalizing this:
Received the following data on the monthly payroll from the payroll clerk: Direct labor (already recorded) . $46,034.00 New payroll data (to be recorded): Factory: Indirect .................................... $22,440.00 Superintendent’s salary ........... 6,200.00 Nonfactory: Sales salaries ........................... 23,950.00 Officers’ salaries ..................... 14,280.00 Office salaries ......................... 12,620.25 Record the monthly payroll in the general journal. Remember that direct labor payroll already has been recorded as it was incurred in January. Salaries for indirect labor are recorded only at the end of the month. Debit Factory Overhead for Indirect Labor and Superintendent’s salaries, debit other salary expense accounts for the appropriate amounts, credit FICA Tax Payable for 7.5% of gross pay, credit Employees’ Income Tax Payable for 15% of gross pay, and credit Salaries Payable for the net pay. 31 Record the employer payroll taxes for January. All payroll taxes relating to factory personnel are debited to Factory Overhead; all payroll taxes related to nonfactory personnel are debited to Payroll Taxes Expense —General. Use a simplified FICA tax rate of 7.5% of gross pay, a state unemployment tax rate of 5.4%, and a federal unemployment tax rate of 0.8%. Since this is the first month in the current year, no employee has reached the ceilings on the payroll taxes. Use the form on page 46 (optional) to determine the amounts for the journal entry.
Explanation / Answer
Journal Entry for Payroll:
2. To record Company's Expenses:
Date Account Title Debit Credit xxx Factory O/H- Indirect Labor 22,440 Factory O/H - Superintendent's Salaries 6,200 Other Salaries A/c - Office and Sales 50,850.25 FICA Tax Payable (7.5%) 5,961.77 Income Tax Payable 11,923.54 Net Payroll Payable 61,604.94