Total payroll of Walnut Co. for October, 2016 is $240,000, of which $40,000 is exempt...
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Total payroll of Walnut Co. for October, 2016 is $240,000, of which $40,000 is exempt from Social Secunty tax because it represented amounts pard in excess of the maxamum tazable wage ( $118,500 individually) to certain employees and $220,000 is exempt from federal unemployment tax because it represented amounts paid in excess of the maxamum taxable wage ( $7,000 individually) to certan employees. Income tases witheld are $50,000 and the state unemployment tax is $1,000 Assume the current FICA tax is 7.65% on an employee's wages to $118,500 and 1.45% in excess of $118,500. The federal unemployment tax is 6% on an employee's wages to $7,000. For federal unemployment tax, Walnut is allowed a tax credit for the full amount of tax pad into the state unemployment tar: Instructions (a) Prepare the joumal entry for the salaries and wages paid ( 5 points). (b) Prepare the entry to record the employer payroll taxes ( 5 points)
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