Although the company has already established medical and retirement plan benefits, Toni Prevosti wants to consider other benefits to attract employees. As the company’s accountant, you have been tasked with annotating employee earnings records with benefit elections for each employee. The following sheet contains details of employee choices. These costs are employer-paid and will take effect on the first pay period of March.

Multiply the employee’s annual salary by 1 percent to calculate the life insurance benefit. For example, if an employee earned $50,000 per year, the life insurance would be $50,000 × 0.01 = $500.

Annotate the Employee Earning Records with payroll-related benefit elections. The amount per period should be included in the record. As an example, if an employee elected to contribute $1,300 to his or her FSA, the period payroll deduction would be $1,300/26, or $50. The estimated yearly earnings used for insurance purposes for the hourly employees are computed as follows: (hourly wages times number of hours worked per week × 52) then divide by 26 pay periods to get an amount per pay period. For example, if Shangraw worked 20 hours per week, the computation is $11/hour × 52 weeks = $11,440 per year. Insurance is computed as $11,440 × 1% = $114.40/26 = $4.40 per pay period.

Transcribed Image Text:

(under $5,000 Employee Flex-Time annually) Yes Yes No No Yes Yes Millen Towle Long Shangraw Lewis Schwartz Prevosti Student Childcare Assistance Yes No No Yes No No No No No No FSA (annual) $500.00 1,200.00 700.00 200.00 1,600.00 450.00 900.00 300.00 Education Life Assistance Insurance (at ($4,000 1% of annual annually) salary value) No Yes Yes No Yes Yes No Yes No Yes Yes Yes No Yes Yes No Long- Term Care Gym Insurance $15 per period No No No No Yes No No No Membership $15 per month Yes Yes Yes No No Yes Yes Yes