menu
bartleby
search
close search
Hit Return to see all results
close solutoin list

Calculate payroll Breakin Away Company has three employees—a consultant, a computer programmer, and an administrator. The following payroll information is available for each employee: For the current pay period, the computer programmer worked 50 hours and the administrator worked 48 hours. The federal income tax withheld for all three employees, who are single, can be determined from the wage bracket withholding table in Exhibit 2 in the chapter. Assume further that the social security tax rate was 6.0%, the Medicare tax rate was 1.5%, and one withholding allowance is $75. Determine the gross pay and the net pay for each of the three employees for the current pay period.

BuyFindarrow_forward

Financial Accounting

15th Edition
Carl Warren + 2 others
Publisher: Cengage Learning
ISBN: 9781337272124

Solutions

Chapter
Section
BuyFindarrow_forward

Financial Accounting

15th Edition
Carl Warren + 2 others
Publisher: Cengage Learning
ISBN: 9781337272124
Chapter 11, Problem 10E
Textbook Problem
10 views

Calculate payroll

Breakin Away Company has three employees—a consultant, a computer programmer, and an administrator. The following payroll information is available for each employee:

Chapter 11, Problem 10E, Calculate payroll Breakin Away Company has three employeesa consultant, a computer programmer, and

For the current pay period, the computer programmer worked 50 hours and the administrator worked 48 hours. The federal income tax withheld for all three employees, who are single, can be determined from the wage bracket withholding table in Exhibit 2 in the chapter. Assume further that the social security tax rate was 6.0%, the Medicare tax rate was 1.5%, and one withholding allowance is $75.

Determine the gross pay and the net pay for each of the three employees for the current pay period.

To determine

Calculate the gross pay and the net pay for each employees for the current pay period.

Explanation of Solution

Gross pay: The total amount such as salary, wages, commissions, overtime, and bonus paid by the employer to an employee in each pay period is called as gross pay.

Net pay: It is the remaining amount of gross pay after all deductions.

Determine the gross pay and the net pay for each employees for the current pay period.

 ConsultantComputer ProgrammerAdministrator
Regular earnings$4,000.00$2,400.00 (4)$2,000.00(9)
Overtime earnings     

 $900.00 (5)

     $800.00(10)
Gross pay$4,000.00$3,300.00$2,800.00
Deductions:   
Social security tax$240.00(1)$198.00(6)$168.00(11)
Medicare tax         $60.00(2) $49.50(7)$42.00(12)
Federal income tax withheld $939.52(3)$757.02(8)596.02(13)
Total deductions$1,239.52$1,004.52$806.02
Net pay$2,760.48$2,295.48$1,993.98

Table (1)

Working note (1):

Calculate withholding social security tax for Consultant.

Social security tax = 6% ×$4,000=$240

Working note (2):

Calculate withholding Medicare tax for Consultant.

Medicare tax = 1.5% of gross salary=1.5%×$4,000=$60

Working note (3):

Calculate the amount of federal income tax withheld for Consultant.

Step 1: Calculate the amount subject to withholding.

Amount subject to withholding = Gross earnings  Withholding allowances amount= $4,000  ($75×2allowances)=$4,000$150=$3,850

Step 2: Calculate federal income tax withheld.

Federal income tax withheld = $890.02 + (33%×($3,850$3,700))=$939.52

Working note (4):

Calculate regular earnings for Computer Programmer.

Regular pay = 40 hours ×$60 per hour=$2,400

Working note (5):

Calculate overtime pay for Computer Programmer.

Overtime pay = (50 hours– 40 hours)×($60×1.5)= 10 hours×$90 per hour= $900

Working note (6):

Calculate withholding social security tax for Computer Programmer.

Social security tax = 6% ×$3,300=$198

Working note (7):

Calculate withholding Medicare tax for Computer Programmer

Still sussing out bartleby?

Check out a sample textbook solution.

See a sample solution

The Solution to Your Study Problems

Bartleby provides explanations to thousands of textbook problems written by our experts, many with advanced degrees!

Get Started

Chapter 11 Solutions

Financial Accounting
Show all chapter solutions
add
Ch. 11 - Proceeds from notes payable On May 15, Maynard Co....Ch. 11 - Proceeds from notes payable On January 26, Nyree...Ch. 11 - Federal income tax withholding Tam Worldlys weekly...Ch. 11 - Federal income tax withholding Marsha Mellows...Ch. 11 - Employee net pay Tam Worldlys weekly gross...Ch. 11 - Employee net pay Marsha Mellows weekly gross...Ch. 11 - Journalize period payroll The payroll register of...Ch. 11 - Journalize period payroll The payroll register of...Ch. 11 - Journalize payroll tax The payroll register of...Ch. 11 - Journalize payroll tax The payroll register of...Ch. 11 - Vacation pay and pension benefits Fukushima...Ch. 11 - Vacation pay and pension benefits Regling Company...Ch. 11 - Estimated warranty liability EarlKeen Co. sold...Ch. 11 - Estimated warranty liability Quantas Industries...Ch. 11 - Quick ratio Nabors Company reported the following...Ch. 11 - Quick ratio Adieu Company reported the following...Ch. 11 - Current liabilities Bon Nebo Co. sold 25,000...Ch. 11 - Entries for notes payable Cosimo Enterprises...Ch. 11 - Entries for discounting notes payable Ramsey...Ch. 11 - Evaluating alternative notes A borrower has two...Ch. 11 - Entries for notes payable A business issued a...Ch. 11 - Entries for discounted note payable A business...Ch. 11 - Entries for notes payable Bull City Industries is...Ch. 11 - Current portion of long-term debt PepsiCo, Inc.,...Ch. 11 - Calculate payroll An employee earns 25 per hour...Ch. 11 - Calculate payroll Breakin Away Company has three...Ch. 11 - Summary payroll data In the following summary of...Ch. 11 - Payroll tax entries According to a summary of the...Ch. 11 - Payroll entries The payroll register for Gamble...Ch. 11 - Payroll entries Urban Window Company had gross...Ch. 11 - Payroll internal control procedures Big Howies Hot...Ch. 11 - Internal control procedures Daves Scooters is a...Ch. 11 - Accrued vacation pay A business provides its...Ch. 11 - Pension plan entries Yuri Co. operates a chain of...Ch. 11 - Defined benefit pension plan terms In a recent...Ch. 11 - Accrued product warranty Parker Manufacturing Co....Ch. 11 - Accrued product warranty General Motors...Ch. 11 - Contingent liabilities Several months ago, Ayers...Ch. 11 - Quick ratio Gmeiner Co. had the following current...Ch. 11 - Quick ratio The current assets and current...Ch. 11 - Liability transactions The following items were...Ch. 11 - Entries for payroll and payroll taxes The...Ch. 11 - Wage and tax statement data on employer FICA tax...Ch. 11 - Payroll register The following data for Throwback...Ch. 11 - Payroll accounts and year-end entries The...Ch. 11 - Liability transactions The following items were...Ch. 11 - Entries for payroll and payroll taxes The...Ch. 11 - Wage and tax statement data and employer FICA tax...Ch. 11 - Payroll register The following data for Flexco...Ch. 11 - Payroll accounts and year-end entries The...Ch. 11 - Selected transactions completed by Kornett Company...Ch. 11 - Ethics in Action Tonya Latirno is a staff...Ch. 11 - Ethics in Action Marvin Turner was discussing...Ch. 11 - Communication WBM Motorworks is a manufacturer of...Ch. 11 - Recognizing pension expense The annual examination...Ch. 11 - Contingent liabilities Reynolds American, Inc.,...

Additional Business Textbook Solutions

Find more solutions based on key concepts
Show solutions add
What is the purpose of a work sheet?

College Accounting (Book Only): A Career Approach

What reinvestment rate assumptions are built into the NPV, IRR, and MIRR methods? Give an explanation for your ...

Fundamentals of Financial Management, Concise Edition (with Thomson ONE - Business School Edition, 1 term (6 months) Printed Access Card) (MindTap Course List)