Question

Please Help

v cost, and burden n the information res full advantage 6. Determine the annual cost, monthly markup for a salaried employee given the int in Table 8-2. Assume the employee takes full of the 401(k) benefit. Table 8-2 Wage Information for Problem 6 Item Cost Wages Bonus Allowances Social Security Medicare FUTA SUTA Workers' Comp. $145,000 $10,000 $500 per month for vehicle 6.2% of wages to $128,700 1.45% of wages 0.6% of wages to $7,000 3.0% of wages to $7,000 $4.25 per $100 of wages General Liability 401(k) Health Insurance 1.02% of wages 100% match up to 6% of wages $375/month

Answer 1

Annual Cost of Salaried Employee :-

Particulars	Amount($)
Wages	145000
Bonus	10000
Allowances	6000
Social Security Tax	7979.40
Medicare	2334.50
Federal Unemployment Tax (FUTA)	42
Sates Unemployment Tax (SUTA)	210
Worker's Compensation Insurance	6842.50
General Liability Insurance	1642.20
Retirement - 401(k)	9660
Health Insurance	4500
Total Annual Cost	194210.60

Calculation :-

1) Allowances = $500 per month * 12 month

= $6000 per year

2) Social Security Tax = $128700*6.2% = 7979.40 per year

3) Medicare Tax = (Wages + Bonus + Allowances) * 1.45%

= ($145000 + $10000 + $6000) * 1.45%

= $161000 * 1.45%

= $2334.50

4) Federal Unemployment Tax (FUTA) = $7000 * 0.6% = $42 per year

5) State Unemployment Tax (SUTA) = $7000 * 3% = $210 per Year

6) Worker's Compensation Insurance = ($145000 + $10000 + $6000)/$100 * $4.25

= $161000/$100 * $4.25

= $6842.50 per year

7) General Liability Insurance = ($145000 + $10000 + $6000) * 1.02%

= $161000 * 1.02%

= $1642.20 per year

8) Retirement (401(k)) = ($145000 + $10000 + $6000) * 6% * 100%

= $161000 * 6%

= $9660 per year

9) Health Insurance = $375 per month * 12 month = $4500 per year

Monthly Cost for a Salaried Employee :-

Monthly Cost = Total Annual Cost / Number of Months

= $194210.60 / 12 months

= $16184.22

Burden Markup for a Salaried Employee :-

Burden Markup = (Total Annual Cost / ((Total Wages)-(wages time off)-(Bonus))) - 1

= ($194210.60 / (($145000+$10000)-($0)-($10000))) - 1

= ($194210.60 / ($155000 - $10000)) - 1

= ($194210.60 / $145000) - 1

= 1.33938 - 1

= 0.3394 or 33.94%