The payroll register of Castilla Heritage Co. indicates $1,920 of social security withheld and $480 of Medicare tax withheld on total salaries of $32,000 for the period. Federal withholding for the period totaled $5,440.

Retirement savings withheld from employee paychecks were $2,600 for the period.

Required:

Provide the journal entry for the period's payroll. If an amount box does not require an entry, leave it blank.

Answer and Explanation:

The Journal entry is following below:

Salary Expense Dr,$32,000

To Social Security Tax Payable $1,920

To Medicare Tax Payable $480

To Federal Withholding Tax Payable $5,440

To Retirement Contribution Payable $2,600

To Salaries Payable $21,560

(Being period's payroll is recorded)

Therefore, we debited the salary expenses as expenses is increasing while we credited the social security taxes payable, medicare tax payable, federal withholding tax payable, retirement contribution payable and salaries payable as its increasing the liabilities.