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Abe Carter had gross earnings of $6,000 for the pay period ending 11/30. His total gross earnings as of 11/15 (the end of the previous pay period) were $126,200. If Social Security taxes are 6.2% on a maximum earnings threshold of $132.900 per year and Medicare tax is 1.45% on all earnings, the journal entry to record his earnings for the period ending 11/30 would include:

Respuesta :

Answer: credit to Medicare Tax Payable for $87.00

Explanation:

Based on the information given in the question, since the Medicare tax is 1.45% on all earnings, and Abe Carter had gross earnings of $6,000 for the pay period ending 11/30, the journal entry to record his earnings for the period ending 11/30 would be the Medicare tax payable. This will be:

= 1.45% × $6000

= 1.45/100 × $6000

= 0.0145 × $6000

= $87.00

There's, there'll be a credit to Medicare Tax Payable for $87.00.

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