According to a summary of the payroll of Scotland Company, $450,000 was subject to the 6.0% social security tax and $500,000 was subject to the 1.5% Medicare tax. Federal income tax withheld was $98,000. Also, $15,000 was subject to state (5.4%) and federal (0.8%) unemployment taxes. The journal entry to record accrued payroll taxes would include a
A) debit to SUTA Payable of $810
B) debit to SUTA Payable of $18,900
C) credit to SUTA Payable of $810
D) credit to SUTA Payable of $18,900

Question

According to a summary of the payroll of Scotland Company, $450,000 was subject to the 6.0% social security tax and $500,000 was subject to the 1.5% Medicare tax. Federal income tax withheld was $98,000. Also, $15,000 was subject to state (5.4%) and federal (0.8%) unemployment taxes. The journal entry to record accrued payroll taxes would include a  
A) debit to SUTA Payable of $810
B) debit to SUTA Payable of $18,900
C) credit to SUTA Payable of $810
D) credit to SUTA Payable of $18,900

Quizplus · Accepted Answer

SUTA Payable = $15,000 × 5.4% = $630
The journal entry to record the accrued payroll taxes would include a credit to SUTA Payable of $810.

According to a Summary of the Payroll of Scotland Company