This accounting problem is solved step by step below, with detailed explanations to help you understand the method and arrive at the correct answer.
ScanSolve AI Answer
Step 1: Calculate Basic Wages and Overtime Wages for the month of April. We assume April has 4 weeks for calculation purposes, as "per week" rates are provided. Normal Time Hours per week: 40 hours Normal Time Rate per hour: R130 Overtime Hours per week: Total hours worked (46) - Normal time hours (40) = 6 hours Overtime Rate per hour: 1 (1)/(2) × R130 = 1.5 × R130 = R195 Now, calculate for the month (4 weeks): Basic Wages: 40 hours/week × R130/hour × 4 weeks = R20\,800 Overtime Wages: 6 hours/week × R195/hour × 4 weeks = R4\,680 Gross Wages: Basic Wages + Overtime Wages = R20\,800 + R4\,680 = R25\,480 Step 2: Calculate Employee Deductions for the month of April. SARS-PAYE: 20% of Gross Wages = 0.20 × R25\,480 = R5\,096 JB Pension fund: 7.5% of Basic Wages = 0.075 × R20\,800 = R1\,560 Bonita Medical Aid Fund: R280 (Assumed to be a monthly fixed amount, as no "per week" is specified) = R280 Unemployment Insurance Fund (UIF): 1% of Basic Wages = 0.01 × R20\,800 = R208 Union fees: R16 per week × 4 weeks = R64 Total Employee Deductions: R5\,096 + R1\,560 + R280 + R208 + R64 = R7\,208 Step 3: Calculate Net Wages for the month of April. Net Wages: Gross Wages - Total Employee Deductions = R25\,480 - R7\,208 = R18\,272 Step 4: Calculate Employer Contributions for the month of April. JB Pension fund: 10% of Basic Wages = 0.10 × R20\,800 = R2\,080 Medical aid: R1.50 for every R1 contributed by the employee. Employee contribution is R280. Employer Medical Aid = 1.50 × R280 = R420 UIF: 1% of Basic Wages = 0.01 × R20\,800 = R208 Skills Development Fund (SDL): 1% of Basic Wages = 0.01 × R20\,800 = R208 Total Employer Contributions: R2\,080 + R420 + R208 + R208 = R2\,916 Step 5: Complete the Wages Journal for April 2026. WAGES JOURNAL FOR APRIL 2026 |l|r|r|r|r|r|r|r|r|r|r|r|r|r|r|r| Details & Basic Wages & Overtime Wages & Gross Wages & PAYE & JB Pension & Bonita Med Aid & UIF & Union Fees & Total Deductions & Net Wages & Employer Pension & Employer Med Aid & Employer UIF & SDL & Total Employer Contributions \\ & (R) & (R) & (R) & (R) & (R) & (R) & (R) & (R) & (R) & (R) & (R) & (R) & (R) & (R) & (R) \\ Employee 1 & 20\,800 & 4\,680 & 25\,480 & 5\,096 & 1\,560 & 280 & 208 & 64 & 7\,208 & 18\,272 & 2\,080 & 420 & 208 & 208 & 2\,916 \\ Totals & 20\,800 & 4\,680 & 25\,480 & 5\,096 & 1\,560 & 280 & 208 & 64 & 7\,208 & 18\,272 & 2\,080 & 420 & 208 & 208 & 2\,916 \\ That's 2 down. 3 left today — send the next one.