Nashville Publishing Company pays its employees monthly Paym

Nashville Publishing Company pays its employees monthly. Payments made by the company on October 31, 2019, follow. Cumulative amounts paid to the persons named prior to October 31 are also given 1. Paul Parker, president, gross monthly salary of $18,600; gross earnings prior to October 31, $169,900 2. Carolyn Wells, vice president, gross monthly salary of $14,800; gross earnings paid prior to October 31, $150,900. 3. Michelle Clark, independent accountant who audits the company\'s accounts and performs consulting services, $14,700; gross amounts paid prior to October 31, $43,100. 4. James Wu, treasurer, gross monthly salary of $4,200; gross earnings prior to October 31, $51,000. 5. Payment to Editorial Publishing Services for monthly services of Betty Jo Bradley, an editorial expert, $4,200; amount paid to Editorial Publishing Services prior to October 31, 2019, $32,300 Required 1. Use an earnings ceiling of $122,700 for social security taxes and a tax rate of 6.2 percent and a tax rate of 1.45 percent on al earnings for Medicare taxes. Prepare a schedule showing the following information: a. Each employee\'s cumulative earnings prior to October 31. b. Each employee\'s gross earnings for October. c. The amounts to be withheld for each payroll tax from each employee\'s earnings, the employee\'s income tax withholdings are Paul Parker, $4,878; Carolyn Wells, $4,163; James Wu, $964 d. The net amount due each employee e. The total gross earnings, the total of each payroll tax deduction, and the total net amount payable to employees. 2. Prepare the general journal entry to record the company\'s payroll on October 31 3. Prepare the general journal entry to record payments to employees on October 31 Complete this question by entering your answers in the tabs below. Req 2 and 3 Use an earnings ceiling of $122,700 for social security taxes and a tax rate of 6.2 percent and a tax rate of 1.45 percent on a earnings for Medicare taxes. Prepare a schedule showing the following information (Round your answers to 2 decimal places.):

Solution

Req 1) Schedule of Pay: Employee Name Cumulative earnings Monthly pay Social security Medicare 1.45% Employee income tax withholding Net Pay Paul 169900 18600 0 18600*1.45%=269.70 4878 13452.3 Carolyn 150900 14800 0 214.6 4163 10422.4 Michelle 43100 14700 14700*6.2%=911.40 213.15 13575.45 James 51000 4200 260.4 60.9 964 2914.7 Betty 32300 4200   260.4   60.9    3878.7 TOTAL 56500 1432.2 819.25 10005 44243.55 Req 2) Journal entry of pay deductions and payment: DEBIT $ CREDIT $ 31-Oct-19 Employees Gross Pay 56500 Income tax withheld 10005 Social security taxes 1432.2 Medicare taxes withheld 819.25 Net Pay payable 44243.55 (Being net pay drawn after withhelds) Req 3) Record the entry to summarize payment of the payroll: 31-Oct-19 Net Pay Payable 44243.55 Cash 44243.55 (being payment of pay on later date) Req 3) Record the entry to summarize payment of the employer tax expenses: 31-Oct-19 Tax expenses 2251.45 Social security taxes 1432.2 Medicare taxes withheld 819.25