Hal Simoson manages a Frosty Boydrive-in. His straight-time pay is $ 15per hour, with time-and-a-half for hours in excess of 40 per week. Simpson'spayroll deductions include withheld income tax of 20%,FICA tax, and a weekly deduction of $ 7for a charitable contribution to United Way. Simpson worked 54 hours during the week. Requirement 1
A. Compute Simpson's gross pay and net pay for the week. Assume earnings to date are $16,000.
B. Compute Simpson's not pay for the week.
Requirement 2
Journalize Frosty Boy's wages expense accrual for Simpson's work. An explanation is not required.
Date Accounts Debit Credit
Requirement 3
Journalize the subsequent payment of wages to Simpson.
Date Accounts Debit Credit
For all payroll calculations, use the following tax rates and round amounts to the nearest cent:
Employee: OASDI: 6.2% on first $118,500 earned; Medicare: 1.45% up to $200,000, 2.35% on earnings above $200,000.
Employer: OASDI: 6.2% on first $118,500 earned; Medicare: 1.45% on all earnings; FUTA: 0.6% on first $7,000 earned; SUTA: 5.4% on first $7,000 earned.