Homework Sourse1 Solve the following problem using 62 up to 113700 for soci
1.
Solve the following problem using 6.2%, up to $113,700, for social security tax and 1.45%, no wage limit, for Medicare tax.
As payroll manager for Freeport Enterprises, it is your task to calculate the monthly social security and Medicare withholdings for the following employees.
2.
Dave O\'Bannon earns $41,450 annually as a line supervisor for Redwood Manufacturers.
a. If the SUTA tax rate is 5.4% of the first $7,000 earned in a year, how much SUTA tax must Redwood pay each year for Dave?
$
b. If the FUTA tax rate is 6.0% of the first $7,000 earned in a year minus the SUTA tax paid, how much FUTA tax must the company pay each year for Dave?
$
Employee | Year-to-Date Earnings | Current Month | Social Security | Medicare |
| Graham, C. | $14,800 | $1,540 | $ | $ |
Solution
1.
2.
a. $378.00
b. $42.00
Working:
| Employe | Year-to-date | Current | Social | Medicare | |
| Earnings | Month | Security | |||
| Graham, C. | 14800 | 1540 | 95.48 | 22.33 | |
| Since the year-to-date earnings are below $117,000 | |||||
| social security tax is deductible on the full amount of $1,540. |
