JournaldrillEmployer payroll taxes
A journal entry exercise from Journaldrill. Solve it with an account picker and debit and credit fields in your browser, and it is checked the moment you submit.
The task
For the same $48,000 payroll, Northgate Print Shop must pay employer Social Security tax at 6.2% and Medicare tax at 1.45% on all wages. Only $12,000 of the wages are still subject to federal unemployment tax at 0.6% and state unemployment tax at 2.7%. Record the employer's payroll taxes.
What this exercise teaches
Social Security is $48,000 x 6.2% = $2,976, Medicare $48,000 x 1.45% = $696, federal unemployment $12,000 x 0.6% = $72 and state unemployment $12,000 x 2.7% = $324. The total expense is $4,068.
A hint if you get stuck
The employer's share is one expense with a separate liability for each tax.
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