Exam 7: Calculating Pay and Payroll Taxes: the Beginning of the Payroll Process

On June 15, Bob Love earned $3,000 and has the following deductions: FICA-OASDI 6.2%, FICA-Medicare 1.45%; federal income tax of $300; and state income tax $40. What is his net pay? (Round any intermediate calculations to two decimal places, and your final answer to the nearest whole dollar.)

An employee earns $28 per hour. She worked 50 hours the third week of January (assume time and a half for overtime) Calculate the net pay. The business is involved in interstate commerce. Federal Income Tax rate = 20% State Income Tax rate = 5% FICA rate OASDI = 6.2% and Medicare = 1.45% FUTA rate = .8% SUTA rate = 5.6% $ ________

Workers' compensation insurance is deducted from employees' checks.

Most employers are levied a payroll tax for:

As the Prepaid Workers' Compensation is recognized, the amount will transfer to:

A summary record of each person's earnings, deductions, and net pay is called a(n):

If the employee has $700 withheld from their check for federal income tax, what is the amount that the employer would need to pay for their portion of the federal income tax?

Compute the net pay for each employee. The FICA tax rate is: OASDI 6.2% on a limit of $128,400; Medicare is 1.45%; federal income tax is 15%; state income tax is 5%; and medical insurance is $100 per employee.

An allowance or exemption represents a certain amount of a person's income that will be considered nontaxable.

Both employees and employers pay which of the following taxes?

An employee has gross earnings of $1,800 with withholdings of 6.2% FICA-OASDI, 1.45% FICA-Medicare, $50 for federal income tax and $30 for state income tax. How much is the net pay? (Round any intermediate calculations to the nearest cent, and your final answer to the nearest whole dollar.)

Given the following payroll items you are to identify whether they are the responsibility of the employer and/or the employee by placing an X in the appropriate column. -

To compute federal income tax to be withheld:

Companies can choose different pay periods for hourly workers versus salary workers.

There are two parts to FICA:

A W-4 form:

Compute employee FICA taxes for the year on earnings of $114,000 at 6.2% on a limit of $128,400 for OASDI and 1.45% for Medicare. (Round your answer to the nearest whole dollar.)

Net pay is equal to gross pay less the amount withheld for federal income tax.

The number of allowances claimed by an employee determines how much will be withheld from their paycheck for:

The employees collectively earn a gross wage of $90,000 for the pay period, but the employer says that they cost $97,000. Discuss the discrepancy.