Respuesta :
Answer:
(a) Debit Wages expense for $950; Credit Federal income tax withholding for $94; and Credit Wages payable for $856
(b) Debit wages payable for $856; and Credit Cash for $856.
Explanation:
The entries will look as follows:
a) Prepare the journal entries to record Elize’s pay for the period
Date Account title Dr ($) Cr ($)
Jan 15 Wages expense (w.3) 950
Federal income tax withholding 94
Wages payable (w.4) 856
(To Elize’s pay for the period.)
(b) Prepare the journal entry to record the payment of Elize’s wages.
Date Account title Dr ($) Cr ($)
Jan 15 Wages payable (w.4) 856
Cash 856
(To record the payment of Elize’s wages.)
Workings:
Normal hours = 40
Number of hours worked = 45
Overtime hours = Number or hours worked - Normal hours = 45 - 40 = 5
Normal hourly wage rate = $20
Overtime hourly rate = $30
Federal income tax withholding = $94
w.1: Normal wage amount = Normal hours * Normal wage rate = 40 * $20 = $800
w.2: Overtime pay = Overtime hours * Overtime hourly rate = 5 * $30 = $150
w.3: Wages expense = Normal wage amount + Overtime pay = $800 + $150 = $950
w.4: Wages payable = Total wage amount - Federal income tax withholding = $950 - $94 = $856
