A company has 150 employees, each working 40 hours per week and earning $15 an hour. Although the company does not pay any health or retirement benefits, one of the perks of working at the company is that employees are allowed free skiing on their days off. Federal income taxes are withheld at 15% and state income taxes at 5%. FICA taxes are 7.65% of the first $142,800 earned per employee and 1.45% thereafter. Unemployment taxes are 6.2% of the first $7,000 earned per employee. Required: 1. Compute the total salary expense, the total withholdings from employee salaries, and the actual direct deposit of payroll for the first week of January. 2. Compute the total payroll tax expense a company will pay for the first week of January in addition to the total salary expense and employee withholdings calculated in Part 1. 3. How should a company account for the free skiing given to employees on their days off? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute the total salary expense, the total withholdings from employee salaries, and the actual direct deposit of payroll for the first week of January. Total salary expense Total withholdings Actual direct deposit (Required 1 Required 2 >
A company has 150 employees, each working 40 hours per week and earning $15 an hour. Although the company does not pay any health or retirement benefits, one of the perks of working at the company is that employees are allowed free skiing on their days off. Federal income taxes are withheld at 15% and state income taxes at 5%. FICA taxes are 7.65% of the first $142,800 earned per employee and 1.45% thereafter. Unemployment taxes are 6.2% of the first $7,000 earned per employee. Required: 1. Compute the total salary expense, the total withholdings from employee salaries, and the actual direct deposit of payroll for the first week of January. 2. Compute the total payroll tax expense a company will pay for the first week of January in addition to the total salary expense and employee withholdings calculated in Part 1. 3. How should a company account for the free skiing given to employees on their days off? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute the total salary expense, the total withholdings from employee salaries, and the actual direct deposit of payroll for the first week of January. Total salary expense Total withholdings Actual direct deposit (Required 1 Required 2 >
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:A company has 150 employees, each working 40 hours per week and earning $15 an hour. Although the company does not pay any
health or retirement benefits, one of the perks of working at the company is that employees are allowed free skiing on their days off.
Federal income taxes are withheld at 15% and state income taxes at 5%. FICA taxes are 7.65% of the first $142,800 earned per
employee and 1.45% thereafter. Unemployment taxes are 6.2% of the first $7,000 earned per employee.
Required:
1. Compute the total salary expense, the total withholdings from employee salaries, and the actual direct deposit of payroll for the first
week of January.
2. Compute the total payroll tax expense a company will pay for the first week of January in addition to the total salary expense and
employee withholdings calculated in Part 1.
3. How should a company account for the free skiing given to employees on their days off?
Complete this question by entering your answers in the tabs below.
Required 1 Required Required 3
Compute the total salary expense, the total withholdings from employee salaries, and the actual direct deposit of payroll for
the first week of January.
Total salary expense
Total withholdings
Actual direct deposit
< Required 1
Required 2 >
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