Answer:
Explanation:
1. The computation is shown below:
State unemployment = $10,000 × 4.2% = $420
Federal unemployment = $10,000 × 0.8% = $80
2. The journal entry is shown below:
Payroll tax expense A/c Dr $38,975	
         To Social security tax A/c $30,300    ($505,000 × 6.0%)
         To Medicate tax A/c $8,175    ($545,000 × 1.5%)
         To  State Unemployment tax payable A/c $420
        To  Federal Unemployment tax payable A/c $80
(Being the payroll tax expense is recorded)