Question

Exercise 13-7 (Part Level Submission) Marin Hardware Company’s payroll for November 2017 is summarized below. Amount Subject to Payroll Taxes Unemployment Tax Payroll Wages Due FICA Federal State Factory $128,000 $128,000 $37,400 $37,400 Sales 32,900 32,900 4,300 4,300 Administrative 35,200 35,200 Total $196,100 $196,100 $41,700 $41,700 At this point in the year, some employees have already received wages in excess of those to which payroll taxes apply. Assume that the state unemployment tax is 2.5%. The FICA rate is 7.65% on an employee’s wages to $118,500 and 1.45% in excess of $118,500. Of the $196,100 wages subject to FICA tax, $19,900 of the sales wages is in excess of $118,500. Federal unemployment tax rate is 0.8% after credits. Income tax withheld amounts to $14,700 for factory, $7,000 for sales, and $6,000 for administrative. Collapse question part (a) Prepare a schedule showing the employer’s total cost of wages for November by function. (Round answers to 0 decimal places, e.g. 5,275.) Factory Sales Administrative Total Salaries and Wages $ $ $ $ FICA Taxes FUTA Taxes SUTA Taxes Total Cost $ $ $ $

Answer 1

Prepare a schedule showing employer's total cost of wages for November: Particulars Facto Sales Administrative Total Salaries and wages FICA taxes FUTA taxes SUTA taxes Total cost 128000 9792 299 935 139026 32900 1283 34. 108 34325 35200 2693 0 0 37893 196100 13768 334 1043 211244 Calculations: Factory FICA taxes FUTA taxes- SUTA taxes = 128000 *7.65% 37400 *0.8% 37400 * 2.5% 9792 299.2 935 Salary FICA taes FUTA taxes= SUTA taxes (32900-19900)*7.65% + 19900 * 1.45%-1283.05 4300*0.8% 4300*2.5%- 34.4 107.5 Administrative FICA taxes 35200 * 7.65% 2692.8