Peachey Posts: 99, Reputation: 1 Junior Member #1 Jun 17, 2009, 06:29 AM
Payroll Expenses First Timer
Can anyone understand what to do here, if so please help, my cousin tells me you all help her a lot to understand her work.
Compute the adjustment of payroll expense for the end of may. The 5/5 and 5/20 payroll have already been posted to the books. The bimonthly payroll was paid on the fifth and the twentieth.
1. Gross payroll accured for the period 5/12 through 6/5
2. The gross payroll accrued for 6/1, 6/4, and 6/5
3. The gross payroll accreed through 5/31

Compute the adjustment for employers taxes for the payroll up to and include May 31.
... FICA--7.65%... FUTA--.8%... suta--5.4%
5/5 Payroll... \$_________
5/20 Payroll... \$__________
6/5 Payroll... \$__________
Less 6/1, 6/4, 6/5... \$__________
Payroll of 5/31... \$.__________... x 7.65%... = \$
... x .8%... = \$
... x 5.4%... = \$

Compute the adjustment necessary for Property Taxes Expense for the month of May
4/10 Prepaid Property Taxes... 1,594.78
... Bank... 1,594.78
Paid six monthe property taxes for the period 4/01 through 10/31
_________________
_________________ ___________

Cherri
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 Peachey Posts: 99, Reputation: 1 Junior Member #2 Jun 28, 2009, 10:50 AM

OK I understand no. (1) \$11,072.65 and no. (2) \$2,768.96 but I don't understand no 3 or what do I calculate to get FICA, FUTA, and SUTA.
 ArcSine Posts: 969, Reputation: 106 Senior Member #3 Jun 28, 2009, 11:27 AM
You're getting there. First, can I assume that Question (1) asks for the payroll accrued starting with the 21st of May, rather than the 12th? (That assumption seems to square up better with the given facts.)

Going with that assumption, then you're correct on the first two questions. To answer the third question, think through what you did to answer Q2: you had to consider the payroll just for the specific days mentioned in Q2. Now do the same for Q3, which is asking for the payroll for May 21st to May 31st.

(A hint on getting there a bit quicker: The days covered by Q3 can be thought of as the total days covered by Q1, minus the days covered in Q2. So you can get to your Q3 answer using just your answers for Qs 1 and 2.)

As to the taxes, just apply the rates you're given in the problem to the gross pay for the applicable periods. E.g. if a tax rate is 15%, and the gross pay for Day X is \$100, then the tax for Day X is \$15.

Best of luck,
 Janelle101 Posts: 60, Reputation: 1 Junior Member #4 Jun 28, 2009, 11:41 AM

Thank you I understood no. (3) but I don't understand the taxes, we were not thought how to do it, can you give an example of one showing the calculation. Thank You Very Much.
 ArcSine Posts: 969, Reputation: 106 Senior Member #5 Jun 28, 2009, 12:21 PM
I think what's asked for is the payroll tax for the month of May (May 1 - May 31, inclusive). To do that, you've got to first figure the total gross pay for the month. And doing that is just a matter of following the pattern laid out in the given step-by-step schedule.

Note what that schedule does: It starts with the total of the May 5 payroll (which is given in the problem, and would be the payroll for the first 5 days of May). To that you add the May 20 payroll (also given in the chart). You then add the total for the Jun 5 payroll, but deduct the payroll of the three June days.

Your result is the total gross pay for May. Multiply that number by the three tax rates to arrive at the tax expense for the month of May, for each of the three types of tax.

Good luck!
 Peachey Posts: 99, Reputation: 1 Junior Member #6 Jun 28, 2009, 02:12 PM

How do you deduct days, my whole class is here, including Janelle101. What do we do from here? You are teaching us.

Total of May 5... 5,261.52
Total of May 20... 11,576.32
Total... 16,837.84
Total of June 5... 11,072.65
Total... 27,910.49
 ArcSine Posts: 969, Reputation: 106 Senior Member #7 Jun 28, 2009, 03:41 PM
OK, you've rounded the fourth turn and headed for the finish line. Almost there.

In your last post, the total you've arrived at represents the total payroll from May 1 through Jun 5, no? But what you NEED for the question is the total payroll for May only.

That means removing from your total the payroll amounts for Jun 1, 4, and 5. You can obtain those amounts directly from the daily payroll chart in your problem.

Once you have the total payroll for May 1 - May 31 only, you can apply the given tax rates to that total to get the May tax expenses.

Good to go?
 Peachey Posts: 99, Reputation: 1 Junior Member #8 Jun 28, 2009, 03:56 PM

Ok lets say:
8,303.69 .FICA 7.65&#37;... FUTA .8%.. SUTA 5.4%
... 635.23... 66.42... 448.40
Is this for the 5/5 payroll, sorry we don't know what we are doing.
 ArcSine Posts: 969, Reputation: 106 Senior Member #9 Jun 29, 2009, 03:34 AM
You have computed those tax percentages correctly. But the total payroll you're using, \$8,303.69, is just the payroll total for the days of May 21 - 31. You were correct in excluding the three June days from your total, but for your question you need the total payroll for all of May.

It'll help to understand what your chart is showing you. The first number (\$5,261.52) is the total payroll for the first 5 days of May. The second amount (\$11,576.32) is the total for the days of May 6 - 20.

Below that, you're then given the amounts for the individual days, from May 21 - Jun 5.

In your last post you were figuring the tax rates only on the payroll for May 21 - 31. But remember that your question asks for the tax expense on all of May's payroll.

Now I think you can carry the ball from here. Go get 'em.
 Peachey Posts: 99, Reputation: 1 Junior Member #10 Jun 29, 2009, 07:01 AM

I believe we got it now:
5/5 Payroll... = 5,261.52
5/21 Payroll... = 11,576.32
6/5 Payroll... = 11,072.65
Less 6/1, 6/4, 6/5 = 2,768.96 = 25,141.53
Payroll of 5/31... = 912.43
Total... = 26,053.96
25,141.53 x 0.0765... = 1,923.33
25,141.53 x 0.008... = 201.13
25,141.53 x 0.054... = 1,357.64
Total employers taxes of May = 3,482.10
Gross payroll as of 5/31 may only = 25,141.53
 ArcSine Posts: 969, Reputation: 106 Senior Member #11 Jun 29, 2009, 07:19 AM
Indeed, you got it.

(In the middle of your calculations, though, you don't need to show the May 31 payroll (\$912.43), or the \$26,053.96. But in your tax calculations, you're using the correct total payroll for May 1 - May 31.)

Got to go make a dollar, but it's been fun... good luck!
 Peachey Posts: 99, Reputation: 1 Junior Member #12 Jun 29, 2009, 07:23 AM

Thank you very much wish you were our teacher.
My classmates said to tell you. Thank You All.
 Peachey Posts: 99, Reputation: 1 Junior Member #13 Jun 29, 2009, 01:07 PM

ArcSine thank you a lot from my class, you are a god sent. We also have another problem posted worksheet disaster, I think I did the trial balance correct, it balanced but the adjustments is a problem, we don't know what to do. Please can you help.