Reference no: EM133069919

Question - The payroll of Bonita Company for September 2019 is as follows. Total payroll was $434,000, of which $108,000 is exempt from Social Security tax because it represented amounts paid in excess of $128,400 to certain employees. The amount paid to employees in excess of $7,000 (the maximum for both federal and state unemployment tax) was $423,000. Income taxes in the amount of $86,300 were withheld, as was $8,100 in union dues. The state unemployment tax is 3.5%, but Bonita Company is allowed a credit of 2.3% by the state for its unemployment experience. Also, assume that the current FICA tax is 7.65% on an employee's wages to $128,400 and 1.45% in excess of $128,400. No employee for Bonita makes more than $ 135,000. The federal unemployment tax rate is 0.8% after state credit.

Required - Prepare the necessary journal entries if the wages and salaries paid and the employer payroll taxes are recorded separately.