Payroll Assignment
The assignment requires that you record the payroll in an Excel workbook.
Creative Thought Inc. has four employees. On Dec. 15 th, the company has paid the employees for their work of the
last two weeks. Below is some summary information regarding the December 15 th payroll:
Overtime pay of 1.5 times the regular hourly rate is paid to the hourly staff. Sam Jones is the only employee who
earns a salary and therefore, he does not earn overtime pay.
Other than federal and state income tax, the only other withholding is for social security and medical insurance
(FICA). Social security is 6.2% of wages/salary and Medicare is 1.45% and those rates apply to all four employees of
this Dec 15th payroll. Employers must also match the FICA contributions as part of the payroll taxes (Payroll Tax
Expense).
State (SUTA) and federal (FUTA) unemployment taxes must also be paid by Creative Thought Inc. on behalf of its
employees. SUTA and FUTA are imposed on the first $7,000 of wages paid during the year. The state
unemployment tax rate is 3.55% and because the employers are allowed credits against the federal unemployment
tax rate, the net FUTA rate is .6% of wages/salary. As of 12/15, only Helen Crump and Ellie Walker have gross
earnings below the $7,000 limit. This is payroll is Helen Crump’s first paycheck.
Instructions:
1. Download the Payroll Assignment Excel workbook from the myCourses’ assignment.
2. Complete the Payroll Summary (the 2nd Excel worksheet in the workbook) for Dec 15 th by entering payroll
information for each employee. PLEASE use cell references to the Payroll Data sheet (the first sheet) and formulas
in any cell where a calculation is required.
3. Record the Dec. 15th payroll in the Employee Earnings Subsidiary Ledger (Excel worksheet) by bringing each
employee’s record up-to-date. Use cell references and formulas for calculations (i.e., Net Pay and Totals).
4. Journalize the Payroll in the General Journal by entering the amounts (debits and credits). The account titles
have already been entered. Use cell references.
4. Journalize the Payroll Tax Expenses by entering the amounts (debits and credits)
IGNORE the postings to the General Ledgers. That is a step that is not required in this assignment.
Note: Using the “pointing” method of referring to cells (both in other sheets or in the same sheet), will save you
time and increase the odds of accuracy. You can Google how to do that or follow these steps:
Click the cell in which you want to enter the cell reference or formula.
In the formula bar, type = (equal sign).
Do one of the following, select the cell that contains the value you want or type its cell reference. ... press
Enter or if you are building a formula - finish the formula and then press Enter.
The assignment requires that you record the payroll in an Excel workbook.
Creative Thought Inc. has four employees. On Dec. 15 th, the company has paid the employees for their work of the
last two weeks. Below is some summary information regarding the December 15 th payroll:
Overtime pay of 1.5 times the regular hourly rate is paid to the hourly staff. Sam Jones is the only employee who
earns a salary and therefore, he does not earn overtime pay.
Other than federal and state income tax, the only other withholding is for social security and medical insurance
(FICA). Social security is 6.2% of wages/salary and Medicare is 1.45% and those rates apply to all four employees of
this Dec 15th payroll. Employers must also match the FICA contributions as part of the payroll taxes (Payroll Tax
Expense).
State (SUTA) and federal (FUTA) unemployment taxes must also be paid by Creative Thought Inc. on behalf of its
employees. SUTA and FUTA are imposed on the first $7,000 of wages paid during the year. The state
unemployment tax rate is 3.55% and because the employers are allowed credits against the federal unemployment
tax rate, the net FUTA rate is .6% of wages/salary. As of 12/15, only Helen Crump and Ellie Walker have gross
earnings below the $7,000 limit. This is payroll is Helen Crump’s first paycheck.
Instructions:
1. Download the Payroll Assignment Excel workbook from the myCourses’ assignment.
2. Complete the Payroll Summary (the 2nd Excel worksheet in the workbook) for Dec 15 th by entering payroll
information for each employee. PLEASE use cell references to the Payroll Data sheet (the first sheet) and formulas
in any cell where a calculation is required.
3. Record the Dec. 15th payroll in the Employee Earnings Subsidiary Ledger (Excel worksheet) by bringing each
employee’s record up-to-date. Use cell references and formulas for calculations (i.e., Net Pay and Totals).
4. Journalize the Payroll in the General Journal by entering the amounts (debits and credits). The account titles
have already been entered. Use cell references.
4. Journalize the Payroll Tax Expenses by entering the amounts (debits and credits)
IGNORE the postings to the General Ledgers. That is a step that is not required in this assignment.
Note: Using the “pointing” method of referring to cells (both in other sheets or in the same sheet), will save you
time and increase the odds of accuracy. You can Google how to do that or follow these steps:
Click the cell in which you want to enter the cell reference or formula.
In the formula bar, type = (equal sign).
Do one of the following, select the cell that contains the value you want or type its cell reference. ... press
Enter or if you are building a formula - finish the formula and then press Enter.
