Massimini Company Had the Following Payroll Data for the Year

Essay

Massimini Company had the following payroll data for the year: $\begin{array}{lr}\text { Gross earnings of employees } & \$ 740,000 \\\text { Employee earnings not subject to Social Security tax } & 140,000 \\\text { Employee earnings not subject to FUTA or SUTA tax } & 490,000\end{array}$

Assuming the following:
$\begin{array}{lrl}\text { FICA tax rate on first } \$ 117,000 & 7.65 \% \text { (1.45\% over } \\\$ 117,000) & \\\text { State Unemployment tax rate } & 5.4 \% \quad \text { (SUTA) } \\\text { Federal Unemplovment tax rate } & 8 \% \text { (FUTA) }\end{array}$ Instructions
Compute Massimini's payroll tax expense for the year. Make a summary journal entry to record the payroll tax expense.