Legal Stars pays its employees each week. Its employees’ gross pay is subject to these taxes.
Tax Rate Applied To
FICA—Social security 6.20 % First $106,800
FICA—Medicare 1.45 All gross pay
FUTA 0.80 First $7,000
SUTA 2.15 First $7,000
The company is preparing its payroll calculations for the week ended August 25. Payroll records show the following information for the company’s four employees:
Name Gross Pay
through 8/18 Gross Pay Income Tax Withholding
Dale $ 105,300 $ 2,000 $ 252
Ted 36,650 900 99
Kate 6,750 450 54
Chas 1,050 400 36
In addition to gross pay, the company must pay one-half of the $32 per employee weekly health insurance; each employee pays the remaining one-half. The company also contributes an extra 8% of each employee’s gross pay (at no cost to employees) to a pension fund.
Compute the following for the week ended August 25.
Dale Ted Kate Chas
1. Each employee’s FICA withholdings for Social Security. $ $ $ $
2. Each employee’s FICA withholdings for Medicare.
3. Employer’s FICA taxes for Social Security.
4. Employer’s FICA taxes for Medicare.
5. Employer’s FUTA taxes.
6. Employer’s SUTA taxes.
7. Employee’s net (take-home) pay.
8. Employer’s total payroll-related expense for each employee.