Question

Paloma Co. has four employees. FICA Social Security taxes are 6.2% of the first $128,400 paid to each employee, and FICA Medicare taxes are 1.45% of gross pay. Also, for the first $7,000 paid to each employee, the company’s FUTA taxes are 0.6% and SUTA taxes are 5.4%. The company is preparing its payroll calculations for the week ended August 25. Payroll records show the following information for the company’s four employees.

						Current Week
Name	Gross Pay through Aug. 18					Gross Pay					Income Tax Withholding
Dali		$	124,500				$	4,300				$	511
Trey			125,600					2,800					330
Kiesha			8,700					1,600					53
Chee			2,650					1,600					42

In addition to gross pay, the company must pay one-half of the $92 per employee weekly health insurance; each employee pays the remaining one-half. The company also contributes an extra 8% of each employee’s gross pay (at no cost to employees) to a pension fund.

Required:
Compute the following for the week ended August 25. (Round your intermediate calculations and final answers to 2 decimal places.):

Answer 1

Answer-
Calculation of Net pay for each of the employee
Particulars	Dali	Trey	Kiesha	Chee	Total
Gross pay	$   4,300.00	$ 2,800.00	$ 1,600.00	$ 1,600.00	$   10,300.00
Less:
Health Insurance	$        46.00	$      46.00	$      46.00	$      46.00	$         184.00
Federal Income tax	$      511.00	$    330.00	$      53.00	$      42.00	$         936.00
FICA Social Security Tax	$      241.80	$    173.60	$      99.20	$      99.20	$         613.80
FICA MedicareTax	$        62.35	$      40.60	$      23.20	$      23.20	$         149.35
Net pay	$   3,438.85	$ 2,209.80	$ 1,378.60	$ 1,389.60	$     8,416.85
Calculation of Total Payroll tax for employer
Particulars	Dali	Trey	Kiesha	Chee	Total
Health Insurance	$        46.00	$      46.00	$      46.00	$      46.00	$         184.00
FICA Social Security Tax	$      241.80	$    173.60	$      99.20	$      99.20	$         613.80
FICA MedicareTax	$        62.35	$      40.60	$      23.20	$      23.20	$         149.35
FUTA	NA	NA	NA	$        9.60	$             9.60
SUTA	NA	NA	NA	$      86.40	$           86.40
Pension Fund	$      344.00	$    224.00	$    128.00	$    128.00	$         824.00
Total Payroll Tax expense	$      694.15	$    484.20	$    296.40	$    392.40	$     1,867.15
Account Title	Debit	Credit
Salaries Expense	$ 10,300.00
Health Insurance Payable		$    184.00
Federal Income tax Payable		$    936.00
FICA Social Security tax payable		$    613.80
FICA Medicare tax payable		$    149.35
Salaries Payable		$ 8,416.85
(being salary expenses incurred)
Payroll tax Expense	$   1,867.15
FICA Social Security tax payable		$    613.80
FICA Medicare tax payable		$    149.35
FUTA payable		$         9.60
SUTA Payable		$      86.40
Health insurance Payable		$    184.00
Pension payable		$    824.00
(being employer tax recorded)