Question

This question has parts.

36A) An employee earned $61,600 during the year working for an
employer. The FICA tax rate for Social Security is 6.2% of the
first $118,500 of employee earnings per calendar year and the FICA
tax rate for Medicare is 1.45% of all earnings. The current FUTA
tax rate is 0.6%, and the SUTA tax rate is 5.4%. Both unemployment
taxes are applied to the first $7,000 of an employee's pay. What is
the amount of total unemployment taxes the *employee* must
pay?

B) A company's warehouse contents were destroyed by a flood on September 12. The following information was the only information that was salvaged:

Inventory, beginning: $29,600

Purchases for the period: $18,600

Sales for the period: $56,600

Sales returns for the period: $860

The company's average gross profit ratio is 24%. What is the estimated cost of the lost inventory?

C) Farthington Soccer Supplies purchases merchandise from a supplier on credit, terms 2/10, n/30 for $15,300. Assume the company uses a perpetual inventory system, and records purchases using the gross method. When recording the purchase transaction in its purchases journal, Farthington would enter:

D) The chief executive officer earns $21,300 per month. As of May 31, her gross pay was $106,500. The tax rate for Social Security is 6.2% of the first $118,500 earned each calendar year and the FICA tax rate for Medicare is 1.45% of all earnings. The current FUTA tax rate is 0.6%, and the SUTA tax rate is 5.4%. Both unemployment taxes are applied to the first $7,000 of an employee’s pay. What is the amount of FICA - Medicare withheld from this employee for the month of June?

Answer #1

Solution 1:

Zero

The question asks how much unemployment tax the employee must pay. The employer is the one responsible for unemployment of the employee.

Solution 2:

COGS = ($56,600 - $860) * 76% = $42,361.40

Goods available for sale = $29,600 + $18,600 = $48,200

EI = $48,200 - $42,361.40 = $5,837.60

Solution 3:

$15,300 in the Inventory Dr. column,

$15,147 in the Accounts Payable Cr. column, and

$153 in the Purchase Discount Cr. column

Solution 4:

FICA- Medicare tax = $106,500 x 0.0145 = $1544.25

66A) An employee earned $62,100 during the year working for an
employer. The FICA tax rate for Social Security is 6.2% of the
first $118,500 of employee earnings per calendar year and the FICA
tax rate for Medicare is 1.45% of all earnings. The current FUTA
tax rate is 0.6%, and the SUTA tax rate is 5.4%. Both unemployment
taxes are applied to the first $7,000 of an employee's pay. What is
the amount of total unemployment taxes the employee...

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SUTA tax rate is 5.4%. Both unemployment taxes are applied to the
first $7,000 of an employee's pay. The employee has $210 in federal
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An employee earns $6,100 per month working for an employer. The
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earned each calendar year and the FICA tax rate for Medicare is
1.45% of all earnings. The current FUTA tax rate is 0.6%, and the
SUTA tax rate is 5.4%. Both unemployment taxes are applied to the
first $7,000 of an employee's pay. The employee has $206 in federal
income taxes withheld. The employee has voluntary deductions...

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pay. What is the amount of FICA-Social Security...

BMX Company has one employee. FICA Social Security taxes are
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BMX Company has one employee. FICA Social Security taxes are
6.2% of the first $128,400 paid to its employee, and FICA Medicare
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SUTA taxes are 5.4% of the first $7,000 paid to its employee.
Gross Pay through
August 31
Gross Pay for September
a.
$
6,600
$
500
b.
2,100
2,200
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122,300
8,200
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