Diana Olympic works 40 hours for Quartz,Inc.for $27 per hour.Required payroll deductions are: Social Security $66.96;Medicare $15.66;Federal income tax $104.40;and State income tax $18.00.The entry to record her net pay would cause which of the following to change as described?
A)Salaries and Wages Expense increases by $1,080.
B)Salaries and Wages Expense decreases by $1,080.
C)Salaries and Wages Payable increases by $1,080.
D)Salaries and Wages Payable decreases by $1,080.

Question

Quizplus · Accepted Answer

The journal entry would include a debit to Salaries and Wages Expense for $1,080 (or 40 hours × $27 per hour),a credit to Withheld Income Taxes Payable for $122.40 (or $104.40 + $18.00),a credit to FICA Payable for $82.62 (or $66.96 + $15.66),and a credit to Salaries and Wages Payable for $874.98 (her net pay).The debit to Salaries and Wages Expense causes that account to increase.

Diana Olympic Works 40 Hours for Quartz,Inc