Answer:
Debit Payroll expenses (p/l) $14,000
Credit Cash account $9,169
Credit FICA Taxes payable $1,071
Credit Federal taxes payable $2,690
Credit State taxes payable $840
Credit Insurance premium payable $230
Being entries to record payroll expenses and the deductions withheld.
Explanation:
The weekly payroll of $14,000 is an expense to be recognized as a debit in the income statement. The net amount of this expense after the deduction of all statutory deductions and the insurance premium is paid to the employees. The deductions where withheld (yet to be remitted to the appropriate bodies) is a liability to the company. To account for this,
Debit Payroll/Employee expenses (with the gross amount)
Credit Cash account (with the amount paid to employees)
Credit Payable accounts ( with the amounts withheld)
The cash paid
= $14,000 - $1,071 - $2,690 - $840 - $230
= $9,169
