The payroll records of Barnes Co provided the following dat

. The payroll records of Barnes Co. provided the following data for the current weekly pay period ended March 12 Earnings to End of Previous Gross Income Insurance Union United Federal Medical Employees R.Short L. Skyler Week Pay Taxes Deduction Dues Way $35 $10 $10 15 . Richardson 12,900 1,440 40435 1010 $5,800 $800 S120 6,850 1,000 18 35 10 The Earnings to End of Previous Week are gross earnings for the year prior to the current weekly pay period ended March 12, Assume that the Social Security portion of the FICA taxes is 6.2% on the first $125,000 and the Medicare portion is 1.45% ofall wages paid to each employee for this pay period. The federal and state unemployment tax rates are 0.8% and 5.4%, respectively, on the first $7,000 paid to each employee. Calculate the net pay for each employee. The federal and state unemployment taxes are paid by the employer only (Check: Net pay for R. Short should be a number between $550 and $575. (3 points)

Solution

answer

  

compute the net pay for each employee as follows:

Particulars Short Skyler Richard

Gross Pay (a) $800.00 $1,000.00 $1,440.00

Deduct

Social security @ 6.2% $49.60 $62.00 $89.28

Medicare tax @ $1.45% $11.60 $14.50 $20.88

Federal income tax $120.00 $180.00 $404.00

Medical insurance deduction $35.00 $35.00 $35.00

Union dues $10.00 $10.00 $10.00

United way $10.00 $15.00 $10.00

Total deductions (b) $236.20 $316.50 $569.16

Net pay of each employee (a ? b) $563.80 $683.50 $870.84