Since the SUTA rates changes are made at the end of each year and there is much

Question

Since the SUTA rates changes are made at the end of each year and there is much discussion about changes to the FUTA rate, the avaiíable 2017 rates were used for FUTA and SUTA. Note: For this textbook edition the rate 0.6% was used for the FUTA tax rate for employers. During 2018, Jeff Smallwood worked for two different employers Until May, he worked for Rowdand Construction Company in Ames, towa and earned $20,770. The state unemployment rate for Rowland is 4.6%. He then changed jobs and worked for Ford Improvement Company in Topeka, Kansas, and earned $31,790 for the rest of the year. The state unemployment rate for Ford is S.1%·Determine the unemployment taxes (FUTA and SUTA) that would be paid by each company. Round your answers to the nearest cent. Use Figure 5.1 to determine SUTA caps in towa and Kansas a. Rowland Construction Company b. Ford Improvement Companty

Explanation / Answer

Answer a. Rowland Construction Company FUTA - $20,770 X 0.60%          124.62 SUTA - $20,770 X 4.60%          955.42 Total Taxes      1,080.04 Ford Improvement Company FUTA - $31,790 X 0.60%          190.74 SUTA - $31,790 X 5.10%      1,621.29 Total Taxes      1,812.03

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