Principles of Cost Accounting: P3-10 Marcello Construction Co. uses the job order cost system

Principles of Cost Accounting

P3-10 Summary of payroll procedures
Marcello Construction Co. uses the job order cost system. In recording payroll transactions, the following accounts are used:
Cash Administrative Salaries
Wages Payable Miscellaneous Administrative Expense
FICA Tax Payable Sales Salaries
Federal Unemployment Tax Payable Miscellaneous Selling Expense
State Unemployment Tax Payable Factory Overhead
Employees Income Tax Payable Work in Proces
Payroll
Factory employees are paid weekly, while all other employees are paid semimonthly on the fifteenth and the last day of each month. All salaries and wages are subject to all taxes.

Following is a narrative of transactions completed during January:
Jan 7. Recorded total earnings of factory employees amounting to $68,200, less deductions for employees' income taxes and FICA taxes.
7. Issued check for payment of the payroll.
14. Recorded total earnings of factory employees amounting to $66,300, less deductions for employees' income taxes and FICA taxes.
14. Issued check for payment of the payroll.
15. Recorded Administrative salaries, $10,000 and sales salaries, $18,000, less deductions for employee's income taxes and FICA taxes.
15. Issued check for payment of the payroll.
21. Recorded total earnings of factory employees amounting to $72,500, less deductions for employees' income taxes and FICA.
21. Issued check for payment of the payroll.
28. Recorded total earnings of factory employees amounting to $74,200, less deductions for employees' income taxes and FICA taxes.
28. Issued check for payment of the payroll.
31. Recorded Administrative salaries, $10,000 and sales salaries, $18,000, less deductions for employee's income taxes and FICA taxes.
31. Issued check for payment of the payroll.
31. The following wages and salaries were earned or accrued during January:
Direct labor 302,500
Indirect labor 22,500
Administrative salaries 20,000
Sales Salaries 36,000
Total 381,000

Marcello Construction Company used the following form to compute the amount of payroll taxes incurred:
Items Taxable Earnings FICA Tax Federal Unemployment Tax State Unemployment Tax
Factory Wages
Administrative Wages
Sales Salaries
Total

Required:
1. Complete the previous form to show the payroll taxes imposed on the employer for the month of January.
2. Prepare the journal entries to record the foregoing transactions, including the distribution of payroll costs and payroll taxes, assuming that the payroll taxes imposed on the employer for factory wages are to be charged to Factory Overhead, the taxes for Administrative salaries are to be charged to Miscellaneous Administrative expense, and the taxes for sales salaries are to be charged to Miscellaneous Selling Expense.
3.Assume that the factory employees worked on January 29, 30, and 31. What was the amount of accrued wages on January 31?
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