I have been stuck on this problem for a few days. Paloma Co.Has four emplyees.FICA Social Security taxes are 6.2% of the fir$st $118,500 paid to each emplyee,and FICA Medicare taxes are 1.45% of gross pay. Also,for the first $7,000 paid to each emplyee the comapny FUTA taxes are 0.6% and SUTA taxes are 2.15%. The company is preparing its payroll calcualtions for the week ened August 25. Payroll records show the following information for the company foy employees.Name    Gross pay through Aug 18    Gross Pay       Income Tax WitDali      $115,550                                   $3,100               $440Trey    116,200                                         2,300                   371Kiesha  8,200                                            560                      49Chee   2,150                                                510                       38 In addition to gross pay,the company must pay one-hald of the $82 per employee weekly health insurance; each employee pays the remaining one-half. The company also contributes an extra 8% of each empliyee's gross pay (at no cost employees) to a pension fund.Required:Compute the following for the week ended august 251.) Employees' FICA witholding for social security tax rate 6.20%2.) Employees' FICA witholding for medicare tax rate 1.45%3.)Emploeyr's FICA Taxex for Social Security tax rate 6.20%4.) Employers FICA Taxes for Medicare tax rate 1.45%5.) Employer's FUTA Taxes 0.60%6.) Employers SUTA Taxes tax rate 2.15%

Question
Asked Sep 30, 2019

I have been stuck on this problem for a few days. 

Paloma Co.Has four emplyees.FICA Social Security taxes are 6.2% of the fir$st $118,500 paid to each emplyee,and FICA Medicare taxes are 1.45% of gross pay. Also,for the first $7,000 paid to each emplyee the comapny FUTA taxes are 0.6% and SUTA taxes are 2.15%. The company is preparing its payroll calcualtions for the week ened August 25. Payroll records show the following information for the company foy employees.

Name    Gross pay through Aug 18    Gross Pay       Income Tax Wit

Dali      $115,550                                   $3,100               $440

Trey    116,200                                         2,300                   371

Kiesha  8,200                                            560                      49

Chee   2,150                                                510                       38

 

In addition to gross pay,the company must pay one-hald of the $82 per employee weekly health insurance; each employee pays the remaining one-half. The company also contributes an extra 8% of each empliyee's gross pay (at no cost employees) to a pension fund.

Required:

Compute the following for the week ended august 25

1.) Employees' FICA witholding for social security tax rate 6.20%

2.) Employees' FICA witholding for medicare tax rate 1.45%

3.)Emploeyr's FICA Taxex for Social Security tax rate 6.20%

4.) Employers FICA Taxes for Medicare tax rate 1.45%

5.) Employer's FUTA Taxes 0.60%

6.) Employers SUTA Taxes tax rate 2.15%

 

 

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Expert Answer

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Step 2
  1. Calculation of Employee’s FICA withholding for social security tax rate is 6.20%.
Employee's FICA withholding for social security
tax rate@ 6.20%
Employee Earnings
Subject to Tax
(working Note :1)
$3,000
$2,300
$560
$510
Tax rate
Employees
Tax Amount
@6.20%
D
6.20%
$186
$142.6
T
6.20%
K
6.20%
S34.72
C
6.20%
S31.62
Total
$394.94
Working Note: 1
Calculation of Employee Earnings Subject to Tax
Gross Pay upEaming Limit
Gross Pay
through 18 Augustweek payto August 25
Employee
Current
Earning
Subject to
tax
(a b
$1,18,600
$1,18,500
$8,760
$2,660
(a)
$1,15,500
$1,16,200
$8,200
$2,150
(b)
$3,100
$2,300
$560
$510
$1,18,500
$1,18,500
$1,18,500
$1,18,500
D
$3,000
S2,300
$560
$510
T
K
C
Since employee D is crossing the eaming limit during a week, her eamings subject to tax will
be $3,000
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Employee's FICA withholding for social security tax rate@ 6.20% Employee Earnings Subject to Tax (working Note :1) $3,000 $2,300 $560 $510 Tax rate Employees Tax Amount @6.20% D 6.20% $186 $142.6 T 6.20% K 6.20% S34.72 C 6.20% S31.62 Total $394.94 Working Note: 1 Calculation of Employee Earnings Subject to Tax Gross Pay upEaming Limit Gross Pay through 18 Augustweek payto August 25 Employee Current Earning Subject to tax (a b $1,18,600 $1,18,500 $8,760 $2,660 (a) $1,15,500 $1,16,200 $8,200 $2,150 (b) $3,100 $2,300 $560 $510 $1,18,500 $1,18,500 $1,18,500 $1,18,500 D $3,000 S2,300 $560 $510 T K C Since employee D is crossing the eaming limit during a week, her eamings subject to tax will be $3,000

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Step 3

2. Calculation of Employee’s FICA withh...

Employee's FICA withholding for Medicare
tax rate@1.45%
Таx rate
Employees
Employee Earnings
Subject to Tax
$3,100
$2,300
$560
Тах Amount
@ 1.45%
$44.95
$33.35
1.45%
T
1.45%
K
1.45%
$8.12
$510
С
1.45%
$7.39
Total
$93.81
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Employee's FICA withholding for Medicare tax rate@1.45% Таx rate Employees Employee Earnings Subject to Tax $3,100 $2,300 $560 Тах Amount @ 1.45% $44.95 $33.35 1.45% T 1.45% K 1.45% $8.12 $510 С 1.45% $7.39 Total $93.81

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