A Company Has 24 Employees Who Are Paid on a Monthly

Multiple Choice

A company has 24 employees who are paid on a monthly basis. For the most recent month, gross earnings were $78,000, of which $27,000 is subject to employment taxes. The federal unemployment tax rate is .8% and the state unemployment rate is 5.4%. Federal income taxes are withheld at the rate of 20% of total earnings. All earnings are subject to FICA taxes of 8%.
What is the company's total payroll cost for the month?

A) $101,514
B) $ 85,914
C) $ 6,240
D) $ 78,000