1-3A Wage and tax statement data on employer FICA tax PR 1 Courtside Concepts Co

Question

1-3A Wage and tax statement data on employer FICA tax PR 1 Courtside Concepts Co. began business on January 2, 2011. Salaries were paid ees on the last day of each month, and social security tax, Medicare tax, and ploy eral income tax were withheld in the required amounts. An employee who is h the middle of the month receives half the monthly salary for that month. Al payroll tax reports were filed, and the correct amount of payroll taxes was remitted the company for the calendar year. Early in 2012, before the Wage and Tax Stat (Form W-2) could be prepared for distribution to employees and for filing with the Social Security Administration, the employees' earnings records were inadvertently destroyed. None of the employees resigned or were discharged during the year, and there were no changes in salary rates. The social security tax was withheld at the rate of 6.0% and Medicare tax at the rte of 1.5% on salary. Data on dates of employment, salary rates. and employees' income taxes withheld, which are summarized as follows, were obtained from personnel records and payroll records: Monthly Income Tax Withheld Monthly Salary 4,400 7,200 Date First Employed Employee Garnett Kidd J. O'Neal Bryant S. O'Neal Oct. 1 1,442 356 12,800 5,000 11,200 3,012 Duncan Instructions 1. Calculate the amounts to be reported on each employee's Wage and Tax Statement (Form W-2) for 2011, arranging the data in the following form: Federal Income Tax Withheld Social Security Tax Withheld Medicare Tax Withheld Earnings 2. Calculate the following employer payroll taxes for the year: (a ) social security; b) Medicare; (c) state unemployment compensation each employee's earnings; (d) federal unemployment compensation at first $10,000 of each employee's earnings; (e) total. at 4.6% on the first $10,000 of 0.8% on the

Explanation / Answer

1 Gross Federal Income Social Security Medicare Employee Earnings Tax Withheld Tax Withheld Tax Withheld Arnett $52,800.00 $         8,472.00 $        3,168.00 $        792.00 Cruz    21,600.00             4,326.00 $        1,296.00 $        324.00 Edwards    30,600.00             4,301.00 $        1,836.00 $        459.00 Harvin      6,000.00                712.00 $           360.00 $          90.00 Nicks 147,200.00           34,638.00 $        8,832.00 $     2,208.00 Shiancoe      5,000.00                856.00 $           300.00 $          75.00 Ward 123,200.00           28,204.00 $        7,392.00 $     1,848.00 Totals $      23,184.00 $     5,796.00 2 a. Social security tax paid by employer $    23,184.00 b. Medicare tax paid by employer $      4,945.20 c. and d. Employee SUTA/FUTA EARNIINGS Arnett $10,000 Cruz            10,000 Edwards            10,000 Harvin              6,000 Nicks            10,000 Shiancoe              5,000 State unemployment compensation tax: $61,000 × 4.6% $            2,806 Ward            10,000 Totals $61,000 Federal unemployment compensation tax: $61,000 × 0.8% $                488 e. Total payroll tax expense $    31,423.20

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