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Calculation of Payroll and related tax expense

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An employee received a paycheck from her employer in the amount of $776.35. The pay-check stub indicated that in calculating her $776.35 net pay, $139.75 had been withheld for federal income tax, $34.25 for state income tax, and $74. 65 for FICA. Assuming that the employer had to match her share of FICA tax, and in addition had to pay unemployment insurance tax of $40.05.

I need to prepare a journal entries that record these transaction. I am confused should the FICA tax be doubled because the employer matched her share?

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Solution Summary

The solution prepares the journal entries to record a payroll check and a second entry for the employer tax expense. A further explanation is added to explain the 'doubling' effect for FICA and Medicare tax.

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In response to your question about why the FICA taxes are doubled: it is a matching tax. The employer withheld an amount from the employee, but then the employer must match that tax.

That's your 'double': half employee and half ...

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