Note: For this textbook edition the rate 0.6% was used for the FUTA tax rate for

Question

Note: For this textbook edition the rate 0.6% was used for the FUTA tax rate for employers.

During 2018, Shoupe Company was subject to the New Jersey state unemployment tax of 5.1%. The company's taxable wages for FUTA were $93,400 and for SUTA, $194,300. Compute the following; round your answers to the nearest cent.

a. SUTA tax that Shoupe Company would pay to the state of New Jersey
$

b. Net FUTA tax for 2018
$

c. Amount of employees' unemployment tax for 2018 (use the employee's tax rate shown in Figure 5.1.)
$

Explanation / Answer

A) Shoupe company's taxable wages for SUTA = $ 194300

State unemployment tax rate = 5.1%

SUTA tax that Shoupe Company would pay to the state of New Jersey = $ 194300X 0.051

SUTA tax = $ 9909.30

B) The company's taxable wages for FUTA were $93,400

FUTA tax rate= 0.6%

Net FUTA tax for 2018 = $93400X 0.6% = $560.04

C) Employee's tax rate = 5.1%

Employees' unemployment tax for 2018 = $93400*5.1%= $4763.40

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