Ehrlich Co began business on January 2 Salaries were paid to

Ehrlich Co. began business on January 2. Salaries were paid to employees on the last day of each month, and social security tax, Medicare tax, and federal income tax were withheld in the required amounts. An employee who is hired in the middle of the month receives half the monthly salary for that month. All required payroll tax reports were filed, and the correct amount of payroll taxes was remitted by the company for the calendar year. Early in the following year, before the Wage and Tax Statements (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 rate 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:

Solution

1 Employee Gross Earnings Federal income Tax withheld Social security tax withheld @ 6% Medicare Tax @ 1.5% Arnet 5100 754.5 306 76.5 (3400*1.5) (503*1.5) Cruz 63600 11952 3816 954 (5300*12) (996*12) Edwards 6300 780 378 94.5 (2100*3) (260*3) Harvin 2500 310 150 37.5 (2500*1) (310*1) Nicks 112200 25245 6732 1683 (10200*11) (2295*11) Shiancoe 35000 5360 2100 525 (3500*10) (536*10) Ward 12150 2625 729 182.25 (8100*1.5) (1750*1.5) 2 Employee Gross Earnings Social security tax withheld @ 6% Medicare Tax @ 1.5% State Unemployment Compensation Federal Unemployment Compensation Arnet 5100 306 76.5 275.4 40.8 (3400*1.5) (5100*5.4%) (5100*0.8%) Cruz 63600 3816 954 540 80 (5300*12) (10000*5.4%) (10000*0.8%) Edwards 6300 378 94.5 340.2 50.4 (2100*3) (6300*5.4%) (6300*0.8%) Harvin 2500 150 37.5 135 20 (2500*1) (2500*5.4%) (2500*0.8%) Nicks 112200 6732 1683 540 80 (10200*11) (10000*5.4%) (10000*0.8%) Shiancoe 35000 2100 525 540 80 (3500*10) (10000*5.4%) (10000*0.8%) Ward 12150 729 182.25 540 80 (8100*1.5) (10000*5.4%) (10000*0.8%) Total 14211 3552.75 2910.6 431.2 (a) $14211 (b) $ 3552.75 © $2910.6 (d) $ 431.20