ACC 304 Course Great Wisdom / tutorialrank.com ACC 304 Course Great Wisdom / tutorialrank.com | Page 253
At this point in the year, some employees have already received
wages in excess of those to which payroll taxes apply. Assume
that the state unemployment tax is 2.5%. The FICA rate is
7.65% on an employee’s wages to $114,600 and 1.45% in
excess of $114,600. Of the $289,600 wages subject to FICA tax,
$22,000 of the sales wages is in excess of $114,600. Federal
unemployment tax rate is 0.8% after credits. Income tax
withheld amounts to $16,570 for factory, $6,110 for sales, and
$5,010 for administrative.
6) No Doubt Company includes 1 coupon in each box of
soap powder that it packs, and 10 coupons are redeemable for a
premium (a kitchen utensil). In 2014, No Doubt Company
purchased 8,840 premiums at 70 cents each and sold 122,500
boxes of soap powder at $3.40 per box; 50,000 coupons were
presented for redemption in 2014. It is estimated that 60% of the
coupons will eventually be presented for redemption.
Prepare all the entries that would be made relative to sales of
soap powder and to the premium plan in 2014. (Round answers
to 0 decimal places, e.g. 5,275. If no entry is required, select
"No Entry" for the account titles and enter 0 for the amounts.
Credit account titles are automatically indented when amount is
entered. Do not indent manually.)