Use this information to answer the following question. The following totals for the month of November were taken from the payroll register of Levine Company:
$\begin{array}{llr}
\text { Salaries expense } &\$12,000\
\text { Social security and Medicare taxes withheld
} &550\
\text { Income taxes withheld } &2,500\
\text { Medical insurance deductions } &250\
\text { Life insurance deductions } &200\
\text { Salaries subiect to federal and state unemployment taxes of 6.2 percent} &4,000\
\end{array}$

The entry to record the accrual of employer's payroll taxes would include a debit to Payroll Taxes and Benefits Expense for

Question

Use this information to answer the following question. The following totals for the month of November were taken from the payroll register of Levine Company:
$\begin{array}{llr}
  \text { Salaries expense } &\$12,000\
 \text { Social security and Medicare taxes withheld
 } &550\
 \text { Income taxes withheld } &2,500\
 \text { Medical insurance deductions } &250\
 \text { Life insurance deductions } &200\
 \text {  Salaries subiect to federal and state unemployment taxes of 6.2 percent} &4,000\
\end{array}$

The entry to record the accrual of employer's payroll taxes would include a debit to Payroll Taxes and Benefits Expense for

Quizplus · Accepted Answer

To record the accrual of employer's payroll taxes, we need to debit Payroll Taxes and Benefits Expense. The total of FICA taxes (Social Security and Medicare) is $550 + $66 = $616. The company's share of FUTA is $24. Therefore, the total amount to be accrued for employer's payroll taxes is $616 + $24 + $108 (state unemployment tax) = $748. We add $50 for the employer's portion of the employee's health insurance premium to get a total of $798, which is the amount we should debit to Payroll Taxes and Benefits Expense. Hence, the correct answer is option C.

Use This Information to Answer the Following Question The Entry to Record the Accrual of Employer's Payroll Taxes