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College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756

Solutions

Chapter
Section
BuyFindarrow_forward

College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756
Textbook Problem

The director of the art department at an advertising company, Wilson Watson, wants to hire new office staff. His boss tells him that to do so he must find in his budget not only the base salary for this position but an additional 30% for “fringe benefits.” Wilson explodes: “How in the world can there be 30% in fringe benefits?” Write a memo to Wilson Watson explaining the costs that probably make up these fringe benefits.

To determine

Write a memo to the Person W the director of art department explaining the costs that probably make up these fringe benefits.

Explanation

Fringe benefits:

Fringe benefits are an additional benefit received by an employee other than his/her wages. Life insurance coverage, health insurance, company car etc. are the examples of fringe benefits.

Memo

From,

ABC

To,

Person W,

Director of art department,

Advertising company

Sub: To explain about the cost that makes fringe benefits-reg.

Sir,

Every employer is required to pay certain percentage of wages to various government programs for the employees and the cost that has incurred for the employer in total for all this fringe benefits are given below:

Government programs for employeesPercentage
Social security6.2%
Medicare1...

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