Use the following information to answer questions
The following totals for the month of April were taken from the payroll register of Sandhu Corp.
-Assuming Sandhu Corp is also required to remit 140% of the employees' EI withholdings as their share of employee benefits, the journal entry to record the accrual of the employer's portion of EI would include a
A)credit to EI Payable of $486.
B)debit to EI Expense of $347.
C)credit to EI Payable of $347.
D)debit to EI Payable of $486.

Question

Use the following information to answer questions 
The following totals for the month of April were taken from the payroll register of Sandhu Corp. 
-Assuming Sandhu Corp is also required to remit 140% of the employees' EI withholdings as their share of employee benefits, the journal entry to record the accrual of the employer's portion of EI would include a
A)credit to EI Payable of $486. 
B)debit to EI Expense of $347. 
C)credit to EI Payable of $347. 
D)debit to EI Payable of $486.

Quizplus · Accepted Answer

The employer's portion of EI is 140% of the employees' withholdings. If the employees' EI withholdings are $347, then the employer's portion would be 1.4 times $347, which equals $486. Therefore, the journal entry would include a credit to EI Payable of $486.

Use the Following Information to Answer Questions