Exam 7: Calculating Pay and Payroll Taxes: the Beginning of the Payroll Process

Premiums for worker's compensation insurance may be adjusted based on actual payroll amounts at the end of the year.

Compute the net pay for each employee listed below.Assume the following rates: FICA-OASDI 6.2% on a limit of $117,000;Medicare is 1.45%;federal income tax is 20%;state income tax is 5%;and union dues are $10.

For each of the following, identify in Column 1 the category to which the account belongs, in Column 2 the normal balance for the account, in Column 3 the financial statement on which the account balance is reported, and in Column 4 the nature of the account (permanent/temporary). -

The amount withheld for FICA is based on the W-4 form.

The amount of FICA-OASDI and FICA-Medicare withheld from the employee's check is determined by the employee's:

Estimate the annual advance premium for workers' compensation insurance,and record it in general journal form using the following data:

An employee has gross earnings of $1000 and withholdings of $60 FICA (OASDI and Medicare),and $50 for income taxes (FIT and SIT).The employer pays $60 FICA (OASDI and Medicare),$10 for SUTA,and $5.60 FUTA.What is the employer's total cost of the employee?

Gross pay is equal to take-home pay less federal withholdings.

A W-4 form:

Most employers are levied a payroll tax for:

Dave Brown's cumulative earnings are $102,000,and his gross pay for the week is $5,300.If the FICA rates are: OASDI 6.2% on a limit of $117,000 and Medicare is 1.45%,what are his FICA-OASDI and FICA-Medicare taxes for the week?

Which report would an employer review if they wanted to check how much an employee has earned to date?

The premium rate for workers' compensation insurance is based on the age of the employees.

Unemployment taxes are:

What is the purpose of the Fair Labor Standards Act?

An employee earns $33 per hour.She worked 53 hours the third week of January. Calculate the gross pay. The business is involved in interstate commerce. Federal Income Tax rate = 20% State Income Tax rate = 5% FICA rate OASDI = 6.2% and Medicare = 1.45% FUTA rate = .8% SUTA rate = 5.6% $ ________

Net pay equals:

From the following information,complete the chart for gross earnings for the week.Assume an overtime rate of time and a half over 40 hours.

All states do not use the same percent for the state tax rate.

From the following data,determine the FUTA tax liability for Sims Company for the first quarter.The FUTA tax rate is 0.6% on the first $7,000 of earnings.(Assume all quarters have 13 weeks. ) Employees Gross Pay Per Week C. Smith \ 2,500 K. James 900 E. Simpson 1,600