Brookhaven Publishing_ Payroll accounting

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Payroll accounting. Assume that the following tax rates and payroll information pertain to Brookhaven Publishing:

·         Social Security taxes: 4% on the first $55,000 earned per employee                 

·         Medicare taxes: 1.5% on the first $130,000 earned per employee                     

·         Federal income taxes withheld from wages: $7,500                                                                

·         State income taxes: 4% of gross earnings                                                         

·         Insurance withholdings: 1% of gross earnings                                                  

·             

·         State unemployment taxes: 5.4% on the first $7,000 earned per employee     

·         Federal unemployment taxes: 0.8% on the first $7,000 earned per employee 

 

 

The company incurred a salary expense of $50,000 during February. All employees had earned less than $5,000 by month-end and no wages have been paid during the month.

 

a.       Prepare the necessary entry to record Brookhaven’s February payroll. The entry will include deductions for the following:

 

·         Social Security taxes

·         Medicare taxes

·         Federal income taxes withheld

·         State income taxes

 

·         Insurance withholdings

    • 10 years ago
    Brookhaven Publishing_ Payroll accounting
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