Main Street Restaurant incurred salaries expense of 60000 fo

Main Street Restaurant incurred salaries expense of $60,000 for 2016. The payroll expense includes employer FICA tax, in addition to state unemployment tax and federal unemployment tax. Of the total salaries, $17,000 is subject to unemployment tax. The percentages for the taxes are as follows: OASDI-6.2%, Medicare 1.45% Federal Unemployment .696, and State Unemployment 5.6%. Journalize the employer\'s payroll taxes.

Solution

To FICA- OASDI Tax Payable A/c

($60,000 * 6.2 %)

To FICA- Medicare Tax Payable A/c

($60,000 * 1.45%)

To Federal Unemployment Tax Payable A/c

( $17,000 * 0.6%)

To State Unemployment Tax Payable A/c

($17,000 * 5.6%)

Particulars	Debit	Credit
Payroll Tax Expense Dr.	$5,644
To FICA- OASDI Tax Payable A/c ($60,000 * 6.2 %)		$3,720
To FICA- Medicare Tax Payable A/c ($60,000 * 1.45%)		$870
To Federal Unemployment Tax Payable A/c ( $17,000 * 0.6%)		$102
To State Unemployment Tax Payable A/c ($17,000 * 5.6%)		$952
At the time of payment
FICA- OASDI Tax Payable A/c Dr.	$3,720
FICA- Medicare Tax Payable A/c Dr.	$870
Federal Unemployment Tax Payable A/c Dr	$102
State Unemployement Tax Payable A/c Dr	$952
To Bank A/c		$5,644