Exam 7: Payroll and Income Tax

Jim Jones, owner of Freed Company, has three employees who earn $410, $530, and $700, respectively. What is the individual amount Jim owes for state and federal unemployment for (A) the first 11 weeks and (B) week 20? (Assume a state rate of 5.4% and a federal rate of .8%.) Base is $7,000.

Leo Corporation pays its employees on a graduated commission scale: 6% on the first $40,000 in sales, 7% on sales from $40,000 to $80,000, and 9% on sales greater than $80,000. Bernie Kaminsky had sales of $105,000. His commission is:

FUTA tax is computed by the wage-bracket table.

Robert Bryan, Jr., earns $400 per week plus 3% of sales in excess of $7,000. If Robert sells $21,000, how much are his weekly earnings?

Payroll registers cannot record cumulative earnings.

FUTA tax is paid:

The employer will match the employee's Social Security and Medicare contribution.

The FICA tax now requires separate reporting for Social Security and Medicare.

The Fair Labor Standards Act entitles employees to time and a half over 36 1/2 hours.

Janet Smooth pays her workers $175, $465, and $710, respectively, per week. Calculate what Janet will pay at the end of the first quarter for (A) state unemployment and (B) federal unemployment. Assume a state rate of 5.6%. Federal is .8%. Base is $7,000.

The taxable earnings column of a payroll register shows the actual tax.

A quarter is 13 weeks.

Percentage method tables can show:

Using table 7.3, calculate the tax liability for a married taxpayer filing a joint return with a taxable income of $32,500.

Caroline earns $290.25 per week plus 4% commission on all sales. If Caroline averaged sales of $11,500 for the week, what was her total pay for the month assuming a four-week month?

Straight piece rate pay provides a worker an incentive to produce more since pay is based on the number of units produced.

Jim Smith is a salesman who receives a $1,100 draw per week. He receives a 12% commission on all sales. Sales for Jim were $205,000 for the month. Assuming a four-week month, Jim's commission after the draw is:

Rodney Ranger is a shoe salesman for More Co. He is paid $4.60 per hour plus a commission of 3% on all sales. For the week, assuming Rodney works 30 hours and has sales of $2,400, what is his gross pay?

Lana Powell has cumulative earnings of $110,000 at the end of September. In the first week in October she earns $2,000. The amount deducted for Social Security and Medicare from her check is (assume Social Security rate of 6.2% on $110,100 and Medicare of 1.45%):

The base amount for calculating Social Security taxes never changes from year to year.