Problem $22-62($LO $22-4)($Algo$)$

Adam Fleeman, a skilled carpenter, started a home improvement business with Tom Collins, a master plumber. Adam and Tom are

concerned about the payroll taxes they will have to pay. Assume they form an S corporation and each earns a salary of $$96,000$ from

the corporation; in addition, they expect their share of business profits to be $$82,000$ each.

How much Social Security tax and Medicare tax $($or self$-$employment tax$)$ will Adam, Tom, and their corporation have to pay on their

salary and profits? $($Assume Adam and Tom are paying themselves reasonable salaries.$)$