Lightning Electronics is a midsize manufacturer of lithium batteries. The company’s payroll records for the November 1–14 pay period show that employees earned wages totaling $54,000 but that employee income taxes totaling $7,800 and FICA taxes totaling $2,825 were withheld from this amount. The net pay was directly deposited into the employees’ bank accounts. Assume Lightning Electronics also must pay $290 of unemployment taxes for this pay period.
Prepare the journal entry or entries that Lightning would use to record the payroll.
Include both employee and employer taxes. (If no entry is required for a transaction/event, select ""No Journal Entry Required"" in the first account field.)
1) Record journal entries:A) Record the wages expense for November 1-14 time period, including payroll deductions.B) Record the payroll tax expense.

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andromache andromache · Answer 1 · 2019-12-06T05:39:25+01:00

Answer:

Explanation:

The journal entries are shown below:

A. Salary and wages expense A/c Dr $54,000

To income tax withheld payable A/c $7,800

To FICA withheld Tax payable A/c $2,825

To Cash/ Bank A/c $43,375

(Being the expenses and Withholding are recorded and the remaining balance is credited to cash or bank account)

B. Payroll tax expense A/c Dr $3,115

To FICA withheld employer tax payable A/c $2,825

To Unemployment tax payable A/c $290

(Being payroll expense is recorded)