Continuing Payroll Problem, 5A: Chapter 5

This problem continues the computing and recording employee payroll for the Kipley Company for the pay period ending January 8th, 20--. Tasks previously performed include determining gross earnings, FICA withholding, federal, state and city taxes. These computations are shown in the Employee Payroll Register.

Requirements:

1. Compute and record the employee's SUTA contributions.
2. Compute and record the Kipley Company's SUTA and FUTA contributions.

Payroll Register The State Unemployment Tax Act, better known as SUTA, is a form of payroll tax that all states require employers to pay for their employees. SUTA is a counterpart to FUTA, the federal unemployment insurance program. Complete the following step: 1. Compute and record the employee's SUTA contributions (employees pay 0.06% on total gross pay). Note: Round your final answers to nearest cent. . KIPLEY COMPANY, INC. Employee Payroll Register For Period Ending January 8, 20-- EARNINGS DEDUCTIONS NET PAY Name Gross OASDI HI FIT SIT SUTA CIT SIMPLE Grp. Ins. Health Ins. Ck. No. Ck. No. Amount Carson, F. $700.00 $43.401 $10.15 $50.00 $21.49 $21.00 $20.00 Wilson, W. 897.04 55.62 13.01 69.00 27.54 26.91 50.00 Utley, H. 678.75 42.08 9.84 16.00 20.84 20.36 40.00 Fife, L. 877.10 54.38 12.72 35.00 26.93 26.31 50.00 Smith, 790.00 48.98 11.46 61.00 24.25 23.70 20.00 Fay, G. 539.15 33.43 7.82 2.00 16.55 16.17 40.00 Robey G. 623.08 38.63 9.03 10.00 19.13 18.69 50.00 Schork, , T. 773.08 47.93 11.21 53.00 23.73 23.19 60.00 Hardy B. 666.11 41.30 9.66 16.00 20.45 19.98 30.00 Kipley, C. 1,000.00 62.00 14.50 46.00 30.70 30.00 80.00 Totals $467.75 $109.40 $358.00 $231.61 $226.31 $440.00 ---- Taxable Earnings The Federal Unemployment Tax Act (or FUTA, I.R.C. ch. 23) is a United States federal law that imposes a federal employer tax used to help fund state workforce agencies. Employers report this tax by filing an annual Form 940 with the Internal Revenue Service. In the Totals row, complete the following: 1. Net FUTA tax. Since this is the first pay period of the year, none of the employees are near the $7,000 ceiling; therefore, each employee's gross earnings is subject to the FUTA tax. (The employer rate is 0.5%). 2. SUTA tax. Since Kipley Company is a new employer, Pennsylvania has assigned the company a contribution rate of 3.689% on the first $10,000 of each employee's earnings. Note: Round your final answers to nearest cent. KIPLEY COMPANY, INC. Taxable Earnings Payroll Taxes Earnings OASDI HI FUTA SUTA Totals $467.75 $109.39 $