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Accounting Problem - Payroll

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Prepare payroll register and record payroll and payroll tax expense.
(SO 2, 3) Canseco Company has the following data for the weekly payroll ending January 31.

Hours Hourly Rate Federal Income Tax Withholding Health Insurance
M T W T F S
M. Hindi 8 8 9 8 10 3 $11 $34 $10
E. Benson 8 8 8 8 8 2 13 37 15
K. Estes 9 10 8 8 9 0 14 58 15

Employees are paid 1½ times the regular hourly rate for all hours worked in excess of 40 hours per week. FICA taxes are 8% on the first $87,900 of gross earnings. Canseco Company is subject to 5.4% state unemployment taxes on the first $9,800 and 0.8% federal unemployment taxes on the first $7,000 of gross earnings.

Instructions
1. Prepare the payroll register for the weekly payroll.
2. Prepare the journal entries to record the payroll and Canseco's payroll tax expense.

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Solution Summary

This solution is comprised of a detailed explanation to prepare the payroll register for the weekly payroll and the journal entries to record the payroll and Canseco's payroll tax expense.

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Weekly period ended January 31 PAYROLL REGISTER

EMPLOYEE NAME EARNINGS FEDERAL FICA HEALTH TOTAL NET PAY
REGULAR OVERTIME TOTAL INCOME TAX TAX INSURANCE
M. Hindi 440 99 539 34 43.12 10 87.12 451.88
E. Benson 520 39 559 37 44.72 15 96.72 462.28
K. Estes 560 84 644 58 51.52 15 124.52 519.48
Total 1742 129 139.36 40 308.36 1433.64

For the regular earning for each employee, I sum all of the hours worked for each ...

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