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payment and distribution of payroll bronx company the general ledger of the bronx co 729409

Payment and Distribution of Payroll

Bronx Company

The general ledger of the Bronx Company showed the following credit balances on March 15:

FICA Tax Payable


Employees Income Tax Payable


FUTA Tax Payable


State Unemployment Tax Payable


Direct labor earnings amounted to $5,100, and indirect labor was $3,400 for the period from March 16 to March 31. The sales and administrative salaries for the same period amounted to $1,500. Use the following tax rates and bases for this problem: FICA: 8% on the first $100,000. State unemployment: 4% on the first $8,000. FUTA: 1% on the first $8,000. Federal income tax: 10% of each employee’s gross earnings.


1. Prepare the journal entries for the following:

a. Recording the payroll.

b. Paying the payroll.

c. Recording the employer’s payroll tax liability.

d. Distributing the payroll for March 16 to 31.

2. Prepare the journal entries to record the payment of the amounts due for the month for FICA and income tax withholdings.

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