Excel Applications for Accounting Principles 4th Edition by Gaylord Smith

Exercise 4

PROBLEM DATA
Reno Graphics has five employees, and they are paid at the end of each month. Payroll data for November are as follows:

Other information (using 2011 rates) is as follows:
a. Social security taxes are 4.2% of monthly gross pay up to a cumulative total pay of $106,800 for 2011. Employers must pay 6.2% of monthly gross pay up to a cumulative total pay of $106,800 for each employee.
b. Medicare taxes are 1.45% on monthly gross pay with no upper limit.
c. A $25 monthly deduction is made for union dues for all union members.
d. Unemployment taxes are paid on monthly gross pay up to the first $7,000 earned by each employee each year. State and federal rates are 2.7% and.8%, respectively.
REQUIREMENT
Open the file PR from the website for this book at cengagebrain.com. Enter the gross pay and federal income tax withheld for each employee and enter $85,000 for Jones's cumulative gross pay (cell I13). Then, enter the formulas where indicated on the worksheet. As the formulas are entered, the cells that contain zeros will be automatically filled. Enter your name in cell A1. Save the completed file as PR4. Print the worksheet when done. Also print your formulas. Check figure: Jones's net pay (cell H13), $6,518.50.