SFCC Corporation has 8 employees. Information about the October payroll follows:
Name
Breschi, K
Hours
Worked
95
Carballo, P
n/a
Dangelo, J
180
Gaines, T
n/a
Goseco, M
n/a
Skolnick, J
180
Williams, R
Wong, O
172
195
Pay Rate
$12 per
hour
$3,000 per
month
$14 per
hour
$4,500 per
month
$10,100 per
month
$12 per
hour
$9 per hour
$16 per
hour
Federal
Income
Tax
Withheld
$200
$850
$625
$1,100
$3,575
$480
$140
$800
Additional information is as follows:
SFCC is in a state without an income tax. Employees’ federal income tax withholdings depend on various factors,
andemployees worked overtime, with the exception of Oscar Wong, who worked 15 hours of overtime. Overtime is
No the amounts are as indicated in the above table.
paid at 150% gross pay is subject to social security taxes at a 6.5% rate, on an annual base of $100,000. Assume
Assume that of the normal hourly rate.
that Medicare/Medicaid taxes in a 1.5% pergross earnings. These taxes are matched program. These contributions
SFCC has 100% participation are $10 of month employee charitable contribution by the employer. Only Marcia
are withheldfor workers’ compensation insurance at a 2% of gross pay rate. None of this cost is paid by the
SFCC pays from monthly pay.
employee.
SFCC provides employees with a group health care plan; however, the cost is fully paid by employees. The rate is
$250 per month, subject to federal (0.5%) and state (1.5%) unemployment taxes on each employee’s gross pay, up
SFCC’s payroll is per employee.
to $8,000 per year. All gross pay tohad employee retirement $8,000 in the months do not contribute to thiswith the
SFCC contributes 5% of employees an earned in excess of program. Employees leading up to October, plan.
(a)
Complete the payroll schedule on the accompanying blank worksheet.
(b)
Prepare journal entries for SFCC’s payroll and the related payroll expenses.
(a)
Deductions
Name
Gross
Earnings
Federal
Social
Medicare/
Income Tax Security Tax Medicaid
Charitable
Health
Insurance
$
$
$
Net
Earnings
Breschi, K
Carballo, P
Dangelo, J
Gaines, T
Goseco, M
Skolnick, J
Williams, R
Wong, O
Totals
$
–
–
$
–
$
–
–
–
$
–
(b)
GENERAL JOURNAL
Date
Accounts
31-Oct
To
record
payroll
31-Oct
To
record
employer
portion
of
payroll
taxes
and
benefits
Debit
Credit
