Question

3) Bob's Auction House's payroll for April includes the following data:

Gross earnings	$3,800
Salaries subject to FICA:
6.2% OASDI	2,060
1.45% Medicare	3,800
Salaries subject to unemployment:
0.8% FUTA	2,000
2.0% SUTA	2,000
Other deductions include:
Federal income tax	400
State income tax	300

What is the employer's portion of the taxes? (Round intermediary calculations to the nearest cent and final answers to the whole dollar.)

A) $183

B) $184

C) $239

D) $700

Answer 1

Answer: C) $239 -->Refer working note below

.

Working note - Employer's portion of the taxes (Payroll tax expense)
	Amount	Amount
FICA taxes:
OASDI tax                [$2,060 x 6.20%]	127.72
Medicare tax             [$3,800 x 1.45%]	55.10
Total FICA tax		182.82
Unemployement taxes:
FUTA tax                  [$2,000 x 0.80%]	16.00
SUTA tax                  [$2,000 x 0.80%]	40.00
Total unemployment tax		56.00
Employer's portion of the taxes		238.82

.

$238.82 -->rounded off 0 decimals --> $239