1. Harriet Pandel, an employer, is subject to FICA taxes but exempt from FUTA and SUTA taxes. During last quarter of the year, her employees earned monthly wages of $16,900, all of which is taxable. The amount of federal income taxes withheld each month is $1,698. Journalize the payment of wages and record the payroll tax on November 29.
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2. Prior to posting the November 29 payroll transaction, FICA Taxes Payable-OASDI, FICA Taxes Payable-HI and Employees FIT Payable had zero balances. Pandel must pay FICA taxes and income taxes withheld on the November 29 payroll. Journalize the electronic transfer of the payroll taxes on December 16.
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3. The employees of Carson Bakery Company earned wages of $7,780 during January. The total amount is taxable under FICA, FUTA, and SUTA. The state contribution rate for the company is 4.3%. Carson Bakery is responsible for SUTA and has always paid timely. The amount withheld for federal income taxes is $998. Journalize the payment of monthly wages, and record the payroll taxes.
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4. Purnell, Inc. has a semimonthly payroll of $53,900 on September 13. The total payroll is taxable under FICA Taxes-HI: $50,400 is taxable under FICA Taxes- OASDI; and $7,300 is taxable under FUTA and SUTA. The state contribution rate for the company is 3.1%. Purnell is responsible for SUTA and has always paid timely. The amount withheld for federal income taxes is $6,995. The amount withheld for state income taxes is $1,010.
a. Journalize the payment of the wages, and record the payroll taxes on September 13.
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5. On December 31, 2013, Santucci Company has a balance of $619.24 in the FUTA taxes payable account. This represents the employer’s liability for the fourth quarter taxes. Journalize the entry Santucci should make in January 2014 to record the last transfer payment of FUTA taxes for 2013.
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6. On December 31, 2012, Sanchez Company needed to record its accrued wages for year-end. December 31 is on Wednesday. The company operates on a five-day workweek, the prior week’s gross pay (December 26 payday) was $29,870, and the net pay was $19,995. Journalize the December 31 entry.
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