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An employee earns $6,400 per month working for an employer.


TB MC Qu. 09-135 An employee earns... 


An employee earns $6,400 per month working for an employer. The FICA tax rate for Social Security is 6.2% of the first $128.400 of earnings each calendar year and the FICA tax rate for Medicare is 1.45% of all earnings. The current FUTA tax rate is 0.6%, and the SUTA tax rate is 5.4%. Both unemployment taxes are applied to the first $7,000 of an employee's pay. The employee has $218 in federal income taxes withheld. The employee has voluntary deductions for health insurance of $186 and contributes $93 to a retirement plan each month. What is the amount the employer should record as payroll taxes expense for the employee for the month of January? 


Multiple Choice 

  • $873.60 

  • $725.60 

  • $533.60

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Answer #1

Answer:

Option 1st is correct. i.e $873.60

Gross pay 6,400.00
%
FICA tax rate for Social Security 6.2%
FICA tax rate for Medicare 1.45%
current FUTA tax rate 0.60%
SUTA tax rate 5.40%
Total tax 13.65%
employers total payrolll tax for employee=6400*13.65%=$873.60
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