Question

 Mest Company has nine employees. FICA Social Security taxes are 6.2% of the first $128,400 paid to each employee, and FICA Medicare taxes are 1.45% of gross pay. FUTA taxes are 0.6% and SUTA taxes are 5.4% of the first $7,000 paid to each employee. Cumulative pay for the current year for each of its employees follows.

 a. Compute the amounts in this table for each employee.

 b. For the company, compute each total for FICA Social Security taxes, FICA Medicare taxes, FUTA taxes, and SUTA taxes.

Answer 1

Employee	Cumulative pay	Pay subject to FICA social security	Pay subject to FICA medicare	Pay subject to FUTA taxes	Pay subject to SUTA taxes
Ken S	$              6,000	$         6,000	$        6,000	$         6,000	$       6,000
Tim V	$            40,400	$       40,400	$     40,400	$         7,000	$       7,000
Steve S	$            87,000	$       87,000	$     87,000	$         7,000	$       7,000
Michale W	$        1,43,500	$   1,28,400	$ 1,43,500	$         7,000	$       7,000
Michale M	$        1,06,900	$   1,06,900	$ 1,06,900	$         7,000	$       7,000
Zach R	$        1,28,400	$   1,28,400	$ 1,28,400	$         7,000	$       7,000
Lori K	$        1,30,900	$   1,28,400	$ 1,30,900	$         7,000	$       7,000
Kitty O	$            36,900	$       36,900	$     36,900	$         7,000	$       7,000
John W	$              4,000	$         4,000	$        4,000	$         4,000	$       4,000
Totals	$        6,84,000	$   6,66,400	$ 6,84,000	$      59,000	$     59,000

Maximum wag limt for FICA social security taxes is $128,400. Hence for Michale W and Lori K pay subjet ot social security tax is 128,400.

	Tax paid by employee	Tax paid by employer	Total tax
FICA social security	$            41,317	$       41,317	$     82,634
FICA medicare taxes	$              9,918	$         9,918	$     19,836
FUTA taxes	$                     -	$             354	$           354
SUTA taxes	$                     -	$         3,186	$        3,186