Culver Co. employed Jen Sing in Year 1. Jen earned $5,200 per month and worked the entire
Question:
Culver Co. employed Jen Sing in Year 1. Jen earned $5,200 per month and worked the entire year. Assume the Social Security tax rate is 6 percent on the first $110,000 of earnings, and the Medicare tax rate is 1.5 percent. Jen’s federal income tax withholding amount is $800 per month. Use 6.0 percent for the unemployment tax rate for the first $7,000 of earnings per employee.
Required
a. Answer the following questions:
(1) What is Jen’s net pay per month?
(2) What amount does Jen pay monthly in FICA payroll taxes?
(3) What is the total payroll tax expense for Culver Co. for January Year 1? February Year 1? March Year 1? December Year 1?
b. Assume that instead of $5,200 per month, Jen earned $10,000 per month. Answer the questions in Requirement a.
Step by Step Answer:
Introductory Financial Accounting for Business
ISBN: 978-1260299441
1st edition
Authors: Thomas Edmonds, Christopher Edmonds