Armstrong Industries has an employee earning $7,200 per month. The FICA tax rate for Social Security is 6.2%, and the FICA tax rate for Medicare is 1.45%. The current FUTA tax rate is 0.8%, and the SUTA tax rate is 5.4%. Both unemployment taxes are applied to the first $7,000 of an employee's pay. The employee has $275 in federal income taxes withheld. The employee also has voluntary deductions for health insurance of $210 and contributes $120 to a retirement plan each month. What is the employee's net pay for the month of January?

Armstrong Industries has an employee earning $7,200 per month. The FICA tax rate for Social Security is 6.2%, and the FICA tax rate for Medicare is 1.45%. The current FUTA tax rate is 0.8%, and the SUTA tax rate is 5.4%. Both unemployment taxes are applied to the first $7,000 of an employee's pay. The employee has $275 in federal income taxes withheld. The employee also has voluntary deductions for health insurance of $210 and contributes $120 to a retirement plan each month. What is the employee's net pay for the month of January?

College Accounting, Chapters 1-27 (New in Accounting from Heintz and Parry)

22nd Edition

ISBN:9781305666160

Author:James A. Heintz, Robert W. Parry

Publisher:James A. Heintz, Robert W. Parry

Chapter9: Payroll Accounting: Employer Taxes And Reports

Section: Chapter Questions

Problem 1CP: Payrex Co. has six employees. All are paid on a weekly basis. For the payroll period ending January...

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