Principles of Cost Accounting: P3-4 The following form is used by Mountain Manufacturing Co

Principles of Cost Accounting

P3-4 Computing and Journalizing Employer's Payroll Taxes
The following form is used by Mountain Manufacturing Co. to compute payroll taxes incurred during April:
Unemployment Taxes
Classification of Wages and Salaries Earnings for Month FICA Tax 8% Federal Tax 1% State Tax 4% Total Payroll Taxes Imposed on Employer
Direct Labor 88,180
Indirect Labor 16,220
Payroll Taxes on factory wages ?
Administrative Salaries 12,000
Sales Salaries 11,500
Total Payroll Taxes ?

Required:
1. Using the above form, calculate the employer's payroll taxes for April. Assume that none of the employees has achieved the maximums for FICA and unemployment taxes.
2. Assuming that the employer payroll taxes on factory wages are treated as factory overhead, the taxes covering administrative salaries are an administrative expense, and the taxes covering sales salaries are a selling expense, prepare a general journal entry to record the employer's liability for the April payroll taxes.
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