Ada Marion Earns a Salary of $7500 Per Month During

Essay

Ada Marion earns a salary of $7500 per month during the year. FICA taxes are 7.65% on the first $117000 of gross earnings. Federal unemployment insurance taxes are 6.2% of the first $7000; however a credit is allowed equal to the state unemployment insurance taxes of 5.4% on the $7000. During the year $25600 was withheld for federal income taxes and $5700 was withheld for state income taxes.
Instructions
(a) Prepare a journal entry summarizing the payment of Ada's total salary during the year.
(b) Prepare a journal entry summarizing the employer payroll tax expense on Ada's salary for the year.
(c) Determine the cost of employing Grace for the year.