ABC Consulting had two employees with the following earnings information: Cumula

Question

ABC Consulting had two employees with the following earnings information: Cumulative Larnings as o 11/31/ 2016 Gross Earnings for Week Ending 12/15/2016 Employee 6.700 111.500 S 500 S4.000 Poppy Smith Henry Murphy Use the table above and calculate the employer payrol income taxes associated with Poppy's December 15 paycheck given the following tax rates: Social Security tax of 6.2% s levied on the first $113,700 of annual wages and the Medicare tax rate is 1.45% on all earnings. State unemployment tax of 5.4% and federal unemployment tax of .6% are both levied on only the first $7,000 of each employee's annual earnings. O $56.25 O $622.65 $23.45 O $68.25

Explanation / Answer

Answer. $56.25 Poopy - Payroll Tax: Social Security Tax - $500 X 6.20%         31.00 Medicare Tax - $500 X 1.45%           7.25 FUTA - ($7,000 - $6,700) X 0.60%           1.80 SUTA - ($7,000 - $6,700) X 5.40%         16.20 Total Payroll Raxes - Poopy         56.25

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