Art Parrish,the Sole Employee of Parrish Sales,has Gross Salary for March

question 102

Essay

Art Parrish,the sole employee of Parrish Sales,has gross salary for March of $4,000.The entire amount is under the OASDI limit of $106,800,and thus subject to FICA.He is also subject to federal income tax at a rate of 18%.Please provide the second entry in the payroll cycle to record the disbursement of his net pay.
$$\begin{array} { | l | r | r | } \hline \quad\quad\quad&\quad&\quad \\\hline \\\hline \\\hline \\\hline\end{array}$$

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Definitions:

Balance Sheet

A balance sheet is a financial statement that provides a snapshot of a company's financial condition at a specific time, summarizing its assets, liabilities, and shareholders' equity.

Income Statement Debit Column

Typically, an income statement does not use a debit column; instead, expenses decrease revenue to show net income or loss.

Balance Sheet Credit Column

Part of the balance sheet that records liabilities, equity, and certain revenues that increase the company's worth or decrease its debts.

Worksheet

An informal business document used internally for planning and preparatory purposes, assisting in the preparation of financial statements or other reports.