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Answer:
1. July 1
Dr Payroll tax expense $60,876
Cr FICA-Social security taxes payable $46,128
Cr FICA-Medicare taxes payable $10,788
Cr State Unemployment Taxes Payable $3,564
Cr Federal Unemployment Taxes Payable $396
2. July 1
Dr Employee benefits expense $16,200
Cr Employee Medical Insurance Payable $9,000
Cr Employee Life Insurance Payable $7,200
3. July 1
Dr FICA-Social security taxes payable $92,256
Dr FICA-Medicare taxes payable $21,576
Dr Federal income taxes payable $186,000
Dr State income taxes payable $41,500
Dr Medical insurance payable $10,000
Dr Life insurance payable $7,000
Dr Union dues payable $4,000
Cr State Unemployment Taxes Payable $3,564
Cr Federal Unemployment Taxes Payable $396
Cr Cash $366,292
Explanation:
1. Preparation of the journal entry to Record the employer's payroll expenses and liabilities for the month of July
July 1
Dr Payroll tax expense $60,876
($46,128+$10,788+$3,564+$396)
Cr FICA-Social security taxes payable $46,128
Cr FICA-Medicare taxes payable $10,788
Cr State Unemployment Taxes Payable $3,564
($66,000 × 5.4%)
Cr Federal Unemployment Taxes Payable $396 ($66,000 × 0.6%)
(To record the employer's payroll expenses and liabilities)
2. Preparation of the journal entry to Record the employer's benefit expense
July 1
Dr Employee benefits expense $16,200
($9,000+$7,200)
Cr Employee Medical Insurance Payable $9,000 [$15,000 × (100%-40%)]
Cr Employee Life Insurance Payable $7,200
[$12,000 × (100%-40%)]
(To Record the employer's benefit expense)
3. Preparation of the journal entry to Record the cash payment of all liabilities related to the July payroll
July 1
Dr FICA-Social security taxes payable $92,256
($46,128+$46,128)
Dr FICA-Medicare taxes payable $21,576
($10,788+$10,788)
Dr Federal income taxes payable $186,000
Dr State income taxes payable $41,500
Dr Medical insurance payable $10,000
Dr Life insurance payable $7,000
Dr Union dues payable $4,000
Cr State Unemployment Taxes Payable $3,564
($66,000 × 5.4%)
Cr Federal Unemployment Taxes Payable $396 ($66,000 × 0.6%)
Cr Cash $366,292
($92,256+$21,576+$186,000+$41,500+*$10,000+$7,000+$4,000+$3,564+$396)
(To Record the cash payment of all liabilities)
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