# Question & Answer: Below is a payroll sheet for Blue import Company for the month of September 2017. The company is allowed a 1% unemployment compensation I…..

Below is a payroll sheet for Blue import Company for the month of September 2017. The company is allowed a 1% unemployment compensation I rate by the state, the federal unemployment tax rate is 0.8% and the maximum for both is \$7,000. Assume a 10% federal income tax rate for all employees and a 7.65% FICA tax on employee and employer on a maximum of \$118,500. In addition, 1.45% is charged both employer and employee for an employee’s wages in excess of \$118,500 per employee. Complete the payroll sheet. (Round answers to 2 decimal places,e.g. 15.26) Unemployment Tax Earnings September Income Tax Earnings Name to Aug. 31 \$6,700 6,400 7,500 13,800 107,800 113,200 Withholding FICA State Federal B. D. Williams D. Raye K. Baker F. Lopez A. Daniels B. Kingston Total \$800 700 1,100 2,000 11,800 17,200 80 61.2 3.00 2.40 70 110 84.15 Make the necessary entry to record the payment of the payroll. (If no entry is required, select “No Entry” for the account titles and enter o for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

The following will be the payroll sheet.

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Question & Answer: Below is a payroll sheet for Blue import Company for the month of September 2017. The company is allowed a 1% unemployment compensation I…..
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 Name Earnings to Aug 31 September earnings Income tax withholidings FICA State Federal Notes B. D.Williams \$6,700 \$800 \$80 \$61.20 \$3.00 \$2.40 note 1 D. Raye 6,400 700 70 53.55 6.00 4.80 note 1 K.Baker 7,500 1,100 110 84.15 nil nil F.Lopez 13,800 2,000 200 153 nil nil A.Daniels 107,800 11,800 1,180 834.50 nil nil note2 B.Kingston 113,200 17,200 1,720 578.00 nil nil note 3 Total \$255,400 33,600 3,360 1,764.40 9.00 7.20

note 1:

b.williams state unemployment tax = \$7000 – \$6700 =>\$300.*1% =>\$3.

federal unemployment tax = \$7000 -\$6700=>\$300*0.8%=>\$2.40.

D.raye state unemployment tax = \$7000 – \$6400 =>\$600*1%=>\$3.

federal unemployment tax = \$7000 – \$6400 =>\$600*0.8%=>\$2.40.

Note2:

A.Daniels FICA = (118,500 – 107,800)* 7.65% + (107,800 +11,800 – 118,500) *1.45%.

=>\$818.55 + \$15.95 =>\$834.50

note3:

B.kingston FICA = (118,500 -113,200)*7.65% + (113,200 +17,200 – 118,500)*1.45%.

=>\$405.45 +\$172.55 =>\$578.

the following is the journal entry.

 Wages and salaries expense a/c 33,600 ……….To FICA Taxes payable 1,764.40 ………..To withholding taxes payable 3,360 ………..To Cash a/c 28,475.60