Question

Macintosh Company has monthly salaries of \(26,000. Assume Macintosh pays all the standard payroll taxes, no employees have reached the payroll tax limits, total income tax withheld is \)2,000, and the only payroll deductions are payroll taxes. Journalize the accrual of salaries expense, accrual of employer payroll taxes, and payment of employee and employer payroll taxes for Macintosh Company.

Short answer

The journal entry for the employers’ expenses and the payment of employers’ expenses are recorded.

Incomplete

Step-by-step solution

Computation of taxes payable amount

$\begin{array}{c}\mathrm{FICA}\mathrm{OASDI}\mathrm{taxes}\mathrm{payable}=\mathrm{Monthly}\mathrm{salaries}\times \mathrm{Rate}\\ \mathbf{=}\mathbf{26}\mathbf{,}\mathbf{000}\mathbf{\times }\mathbf{6}\mathbf{.}\mathbf{2}\mathbf{\%}\\ =\$1,612\\ \end{array}$

$\begin{array}{cc}& \\ \begin{array}{c}\mathrm{FICA}\mathrm{Medicare}\mathrm{taxes}\mathrm{payable}=\mathrm{SalariesAmount}\times \mathrm{Rate}\\ \mathbf{=}\mathbf{26}\mathbf{,}\mathbf{000}\mathbf{\times }\mathbf{1}\mathbf{.}\mathbf{45}\\ =\$377\end{array}& \end{array}$

role="math" localid="1657178864056" $\begin{array}{c}\mathrm{Federal}\mathrm{Unemployment}\mathrm{taxes}\mathrm{payable}=\mathrm{Salary}\mathrm{amount}\times \mathrm{Rate}\\ \mathbf{=}\mathbf{26}\mathbf{,}\mathbf{000}\mathbf{\times }\mathbf{0}\mathbf{.}\mathbf{6}\mathbf{\%}\\ =\$156\end{array}$

$\begin{array}{c}\mathrm{State}\mathrm{Unemployment}\mathrm{taxes}\mathrm{payable}=\mathrm{Salary}\mathrm{amount}\times \mathrm{Rate}\\ \mathbf{=}\mathbf{26}\mathbf{,}\mathbf{000}\mathbf{\times }\mathbf{5}\mathbf{.}\mathbf{4}\mathbf{\%}\\ =\$1,404\end{array}$

$\begin{array}{c}\mathrm{Payrol}\mathrm{ltax}\mathrm{expense}=\mathrm{FICAOASDI}+\mathrm{FICA}\mathrm{Medicare}+\mathrm{Federal}\mathrm{Income}\mathrm{taxes}\mathrm{payable}+\mathrm{Federal}\mathrm{Unemployment}\mathrm{taxes}\mathrm{payable}+\mathrm{State}\mathrm{Unemployment}\mathrm{taxes}\mathrm{payable}\\ =1,612+377+2,000+156+1,404\\ =\$5,549\end{array}$

Journal entries

Journal
Date	Accounts and Explanation	Debit ($)	Credit ($)
	Salaries and wages Expense	26,000
	FICA OASDI Taxes Payable		1,612
	FICA Medicare Taxes Payable		377
	Federal Income taxes Payable		2,000
	Salaries and wages payable		22,011
	(accrual of salaries and wages expense
	Salaries and wages payable	22,011
	Cash		22,011
	(Salaries and wages paid)
	Payroll Tax Expense	5,549
	FICA OASDI Taxes Payable		1,612
	FICA Medicare Taxes Payable		377
	Federal Income taxes Payable		2,000
	Federal Unemployment taxes payable		156
	State Unemployment taxes payable		1,404
	(To record employer’s payroll taxes expense
	FICA OASDI Taxes Payable	1,612
	FICA Medicare Taxes Payable	377
	Federal Income taxes Payable	2,000
	Federal Unemployment taxes payable	156
	State Unemployment taxes payable	1,404
	Cash		5,549
	(To record the payment of payroll taxes)