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Computing Payroll Taxes Payable

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Payroll for the pay period ended October 31, 2007 is summarized as follows:

Federal Income
Department Total Wages Withheld FICA Unemployment
Factory 75,000 9,000 70,000 22,000
Sales 22,000 3,000 16,000 2,000
Office 18,000 2,000 8,000 -
Totals $115,00 $14,000 $94,000 24,000

Facts:
FICA the for employer and employee 7%

Unemployment $3%

What amount should we accrue for payroll taxes in Oct2007 on the balance sheet.

Thanks

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Solution Summary

This solution explains which payroll taxes the employer must accrue and pay, and how to compute them.

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We should accrue 7 percent of $94,000, or $6,580 for the employer's share of FICA ...

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