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1. The hollowing payroll information is provided for Lar Hourly Wage Employee Bill Wheeler Shelly Spooner Max DeLuca Enrique Ruiz Wayne Hobbs $9 $9 $10 $10 $12 # Hrs. 32 36 40 46 50 Contributio to IRA None $20 $40 $40 $60

1. The hollowing payroll information is provided for Lar Hourly Wage Employee Bill Wheeler Shelly Spooner Max DeLuca Enrique Ruiz Wayne Hobbs $9 $9 $10 $10 $12 # Hrs. 32 36 40 46 50 Contributio to IRA None $20 $40 $40 $60

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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1. The hollowing payroll information is provided for Larry's Limos: Employee Bill Wheeler Shelly Spooner Max DeLuca Enrique Ruiz Wayne Hobbs Hourly Wage $9 $9 $10 $10 $12 a. Excise tax- b. Property tax- # Hrs. 32 36 40 Larry pays 150% of the hourly wage for hours worked in excess of 40. Larry matches any employee contributions to their IRA. Social Security/Medicare (FICA) rate is 7.65%. State Unemployment Tax (SUTA) rate is 2.5%. Federal Unemployment Tax (FUTA) rate is 0.5%$. What is the total cost of Larry's payroll? Receipts from clients (Revenue): $8,400 Supplies Expense: $150 Vehicle Expense: $60 Value of vehicle: $6,000 Value of instruments: $3,000 c. Income tax- 46 50 2. Your friend, Ringo, performs music in addition to his regular job as an accountant at Amazon. His financial records for this side business include the following: Contribution to IRA Ringo has licensed his business with the state as a Limited Liability Company. He is required to pay excise tax (2% of net income) and property tax (3% of property value) in addition to additional federal income tax resulting from the net income None $20 $40 $40 $60 of his music business listed on Schedule C. He is also liable for Self-employment tax at the rate of 15.3% of the net income reported on his Schedule C. If Ringo's marginal income tax rate (the amount charged for the net income reported on Schedule C) is 18%, how much must he pay in the various taxes listed? d. Self-employment tax-
Transcribed Image Text:1. The hollowing payroll information is provided for Larry's Limos: Employee Bill Wheeler Shelly Spooner Max DeLuca Enrique Ruiz Wayne Hobbs Hourly Wage $9 $9 $10 $10 $12 a. Excise tax- b. Property tax- # Hrs. 32 36 40 Larry pays 150% of the hourly wage for hours worked in excess of 40. Larry matches any employee contributions to their IRA. Social Security/Medicare (FICA) rate is 7.65%. State Unemployment Tax (SUTA) rate is 2.5%. Federal Unemployment Tax (FUTA) rate is 0.5%$. What is the total cost of Larry's payroll? Receipts from clients (Revenue): $8,400 Supplies Expense: $150 Vehicle Expense: $60 Value of vehicle: $6,000 Value of instruments: $3,000 c. Income tax- 46 50 2. Your friend, Ringo, performs music in addition to his regular job as an accountant at Amazon. His financial records for this side business include the following: Contribution to IRA Ringo has licensed his business with the state as a Limited Liability Company. He is required to pay excise tax (2% of net income) and property tax (3% of property value) in addition to additional federal income tax resulting from the net income None $20 $40 $40 $60 of his music business listed on Schedule C. He is also liable for Self-employment tax at the rate of 15.3% of the net income reported on his Schedule C. If Ringo's marginal income tax rate (the amount charged for the net income reported on Schedule C) is 18%, how much must he pay in the various taxes listed? d. Self-employment tax-
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