Paloma Co. Stars has four employees. FICA Social Security taxes are 6.2% of the

Question

Paloma Co. Stars has four employees. FICA Social Security taxes are 6.2% of the first $117,000 paid to each employee and FICA Medicare taxes are 1.45% of gross pay. Also for the first $7,000 paid to each employee, the company's FUTA taxes are .6% and SUTA taxes are 6.20% The company is preparing its payroll calculations for the week ended August 25. Payroll records show the following information for the company's four employees Current Week Income Tax Gross Pay through Aug. 18 Gross Pay Name Dahlia Trey Kiesha $2,900 450 630 580 $412 $115,900 116,550 8,900 2,850 72 In addition to gross pay, the company must pay one-half of the $96 per employee weekly health insurance; each employee pays the remaining one-half. The company also contributes an extra 8% of each employee's gross pay (at no cost to employees) to a pension fund. Required Compute the following for the week ended August 25. (Round your intermediate calculations and final answers to 2 decimal places.): 1) Employees' FICA Withholdings for Social Security Earnings Subject to Tax Tax Rate Tax Amount Employee Dahlia Trey Kiesha Chee Total

Explanation / Answer

Answer 1. Employees' FICA Withholdings for Social Security Employee Earnings Subject to Tax Tax Rate Tax Amount Dahlia                        1,100.00 6.20%                   68.20 ($117,000 - $115,900) Trey                            450.00 6.20%                   27.90 ($117,000 - $116,550) Kiesha                            630.00 6.20%                   39.06 Chee                            580.00 6.20%                   35.96 Total                 171.12 Answer 2. Employees' FICA Withholdings for Medicare Employee Earnings Subject to Tax Tax Rate Tax Amount Dahlia                        2,900.00 1.45%                   42.05 Trey                            450.00 1.45%                      6.53 Kiesha                            630.00 1.45%                      9.14 Chee                            580.00 1.45%                      8.41 Total                   66.12 Answer 3. Employers' FICA Taxes for Social Security Employee Earnings Subject to Tax Tax Rate Tax Amount Dahlia                        1,100.00 6.20%                   68.20 ($117,000 - $115,900) Trey                            450.00 6.20%                   27.90 ($117,000 - $116,550) Kiesha                            630.00 6.20%                   39.06 Chee                            580.00 6.20%                   35.96 Total                 171.12 Answer 4. Employers' FICA Taxes for Medicare Employee Earnings Subject to Tax Tax Rate Tax Amount Dahlia                        2,900.00 1.45%                   42.05 Trey                            450.00 1.45%                      6.53 Kiesha                            630.00 1.45%                      9.14 Chee                            580.00 1.45%                      8.41 Total                   66.12 Answer 5. Employers' FUTA Taxes Employee Earnings Subject to Tax Tax Rate Tax Amount Dahlia                                     -   0.60%                          -   Trey                                     -   0.60%                          -   Kiesha                                     -   0.60%                          -   Chee                            580.00 0.60%                      3.48 Total                      3.48 Answer 6. Employers' SUTA Taxes Employee Earnings Subject to Tax Tax Rate Tax Amount Dahlia                                     -   6.20%                          -   Trey                                     -   6.20%                          -   Kiesha                                     -   6.20%                          -   Chee                            580.00 6.20%                   35.96 Total                   35.96 Answer 7. Employee Dahlia Trey Kiesha Chee Total Gross Pay                        2,900.00                  450.00                 630.00               580.00            4,560.00 Income Tax Withholding                            412.00                    72.00                   55.00                 44.00               583.00 FICA - Social Security                              68.20                    27.90                   39.06                 35.96               171.12 FICA - Medicare                              42.05                      6.53                      9.14                    8.41                  66.12 Health Insurance                              48.00                    48.00                   48.00                 48.00                  48.00 Net Pay                        2,329.75                  295.58                 478.81               443.63            3,691.76 Answer 8. Employee Dahlia Trey Kiesha Chee Total Gross Pay                        2,900.00                  450.00                 630.00               580.00            4,560.00 FICA - Social Security                              68.20                    27.90                   39.06                 35.96               171.12 FICA - Medicare                              42.05                      6.53                      9.14                    8.41                  66.12 FUTA                                     -                             -                            -                      3.48                  48.00 SUTA                                     -                             -                            -                   35.96            3,691.76 Health Insurance                              48.00                    48.00                   48.00                 48.00                  48.00 Pension - 8%                            232.00                    36.00                   50.40                 46.40                  48.00 Total Payroll Exenses                            390.25                  118.43                 146.60               178.21            4,073.00

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