Question

DATE During the first full week of 2019, the Payroll Department of Omni Corporation is preparing the Forms W-2 for distribution to its employees along with their payroll checks on January 4. In this problem, you will complete the forms in order to gain some experience in recording the different kinds of information required. Assume each employee earned the same weekly salary for each of the 52 paydays in 2018. Using the following information obtained from the personnel and payroll records of the firm, complete Copy A of the six Forms reproduced on the following pages. Also complete Form W-3. The form is to be signed by the president, Frank K and is prepared by Vince Roper. 4-118 contiua 22222 Company Information: Pennsylvania state identification number: Federal identification number: Philadelphia identification number 4800 River Road 00-0-106 00-0000972 0001595 Address Philadelphia, PA 19113-5548 Telephone number: (215) 555-0017 Fax number: (215) 555-0010 Income Tax Inforrmation: The wage-bracket method is used to determine federal income tax withholding, Calculate the annual federal incom tax withbeld by using the weekly wage-bracket table and multiply the answer by 52. The other taxes withbeld an shown below Payroll Data Single, 2 allowances $715 per week SS#: 000-00-4310 Deduction for 401(k) plan: $50/week Married, 3 allowances $985 per week SS#: 000-00-8804 Dependent care payment: $950 $70/week-401(k) Single, 0 allowances $765 per week SS#: 000-00-3316 Union dues withheld: $102 Married, 6 allowances $1,875 per week SS#: 000-00-6839 Cost of group-term life insurance exceeding $50,000: $262.75 $100/week-401(k) Married, 5 allowances $780 per week S50: 000-00-5771 Union dues withheld: $102 Single, 1 allowance $790 per week SS 000-00-8703 Educational assistance payments (job-required): S675 550week-401k) Annual Taxes Withheld Employee Data Randy A. Kellison $4 Gradison Place Philadelphia, PA 19113-4054 Social security tax withheld Medicare tax withheld State income tax withbeld Local income tax withheld 2,305.16 539.24 1,141.40 1,450.28 W-2 Wage and To Copy A Por Soc fom y Social security tax withhel Medicare tax withheld State income tax withheld Local income tax withheld Vince T. Roper $6 Andrews Court, Apt. 7 Philadelphia, PA 19103-3356 3,175.64 742.56 1,572.48 1,997.84 22222 Social security tax withheld Medicare tax withheld State income tax withhel Local income tax withho Social security tax withll Medicare tax withheld State income tax withhe Local income tax withb Murray T. Rodson 770 Camac Street Philadelphia, PA 19101-3770 2,466.36 576.68 1,221.48 1,551.68 Frank A. Kent 338 North Side Avenue Philadelphia, PA 19130-6638 6,061.29 1,417.69 2,993.12 3,802.76 i Carlie C. Christian 4900 Gladwynne Terrace Philadelphia, PA 19127-0049 Social security tax withd Medicare tax withheld State income tax withlel Local income tax wh Social security tax wih Medicare tax withbel State income tax whd Local income tax w 2,514.72 588.12 1,245.40 1,581.84 Zana W. Amelia 480-A Hopkinson Tower Philadelphia, PA 19101-3301 2,546.96 595.92 1,261.00 1,602.12 W-2 Wage and Tax py A For Soal Security Ad Fowaee So Sy Must use percentage method to calculate federal income tax. De Not Cut, R The cost of escess group-term de insurance is added to gross wages for federal income tax, Social Securin and er is not added to gross wages for tate and local taxes; therefore, it is not subject to those taxes (see Figure 4 Employers withhold OASDI and Hl tax on these amounts but are not required to withhold federal income as Source Internal Revenue Seric 4-64 QUESTION 1 What goes in box 1 of the W-2 for Randy A. Kellison? QUESTION 2 What goes in Box 2 of the W-2 for Randy A. Kellison? QUESTION 3 What goes in box 3 & 5 of the W-2 for Randy A. Kellison? QUESTION 4 What goes in box 1 of the W-2 for Vince T. Roper? QUESTION 5 What goes in Box 2 of the W-2 for Vince T. Roper? QUESTION 6 What goes in box 3& 5 of the W-2 for Vince T. Roper? QUESTION 7 Where does the deduction for the 401(k) go on the W-2 for these employees? In Box 14-Code 401k In Box 12- Code D Box 11 Box 9

Answer 1

Part 1

$34,580

Box 1 includes income subject to federal income tax = (715-50)*52 = 34580

Part 2

$2491.22

Wages = 665 (715-50) (weekly)

One Withholding Allowance (2018) (weekly)= $79.80

Therefore two allowances it will be = (80.80*2) = $161.60

Amount of withholding income = 665-161.60 = $503.40

Amount of income tax to be withheld = (18.70+(12%*(503.40-260)))*52= $2491.22

It will be $2520.33 using 2018 rates

Part 3

$37180

Box 3 and 5 includes income subject to social security and medicare taxes = 715*52 = 37180

Part 4

$47580

Box 1 includes income subject to federal income tax = (985-70)*52 = 47580

Part 5

$2392.62

Wages = 915 (985-70) (weekly)

One Withholding Allowance (2018) (weekly)= $79.80

Therefore three allowances it will be = (80.80*3) = $242.40

Amount of withholding income = 915-242.40 = $672.60

Amount of income tax to be withheld = (37.30+(12%*(672.60-600)))*52 = $2392.62

It will be $2449.82 using 2018 rates

Part 6

$51220

Box 3 and 5 includes income subject to social security and medicare taxes = 985*52 = 37180

Part 7

Option B In Box 12 – Code D

The amount deduction for the 401 (k) goes in box 12 – Code D of Form W-2. In case of Randy, the amount is $2600 (50*52) and in case of Vince it is $3640 (70*52)

Dear Student,

kindly check and inform. in case of any doubts, feel free to ask anytime.