Use this information for Magnum Company to answer the following questions.

The following totals for the month of April were taken from the payroll register of Magnum Company:

$$\begin{array} { l r }
\text { Salaries } & \$ 12,000 \
\text { FICA taxes withheld } & 900 \
\text { Income taxes withheld } & 2,500 \
\text { Medical insurance deductions } & 450 \
\text { Federal unemployment taxes } & 32 \
\text { State unemployment taxes } & 216
\end{array}$$
-The journal entry to record the monthly payroll on April 30 would include a
A) credit to Salaries Payable for $8,150
B) debit to Salaries Expense for $7,902
C) debit to Salaries Payable for $8,150
D) debit to Salaries Payable for $7,902

Question

Use this information for Magnum Company to answer the following questions.
​
The following totals for the month of April were taken from the payroll register of Magnum Company:
​
​
 $$\begin{array} { l r } 
\text { Salaries } & \$ 12,000 \
\text { FICA taxes withheld } & 900 \
\text { Income taxes withheld } & 2,500 \
\text { Medical insurance deductions } & 450 \
\text { Federal unemployment taxes } & 32 \
\text { State unemployment taxes } & 216
\end{array}$$ ​
-The journal entry to record the monthly payroll on April 30 would include a
A) credit to Salaries Payable for $8,150
B) debit to Salaries Expense for $7,902
C) debit to Salaries Payable for $8,150
D) debit to Salaries Payable for $7,902

Quizplus · Accepted Answer

The total deductions from the salaries are FICA taxes ($900), income taxes ($2,500), and medical insurance deductions ($450), which sum up to $3,850. Subtracting this from the total salaries of $12,000 gives $8,150, which is the net amount payable to employees, hence a credit to Salaries Payable for $8,150.

Use This Information for Magnum Company to Answer the Following