Liam Wallace is general manager of Worldwide Salons. During 2018Wallace worked for the company all 18, 1 year at a $ 12,900 monthly salary. He also earned a year-end bonus equal to 15% of his annual salary Wallace's federal income tax withheld during 2018 was $1,161 per month, plus $2,322 on his bonus check. State income tax withheld came to $170 per month , plus $110 on the bonus . FICA tax was withheld on the annual earnings . Wallace authorized the following payroll deductions : Charity Fund contribution of 4% of total earnings and life insurance of $35 per month . Requirement 2. Compute Worldwide’s total 2018 payroll tax expense for Wallace.
Liam Wallace is general manager of Worldwide Salons. During 2018Wallace worked for the company all 18, 1 year at a $ 12,900 monthly salary. He also earned a year-end bonus equal to 15% of his annual salary Wallace's federal income tax withheld during 2018 was $1,161 per month, plus $2,322 on his bonus check. State income tax withheld came to $170 per month , plus $110 on the bonus . FICA tax was withheld on the annual earnings . Wallace authorized the following payroll deductions : Charity Fund contribution of 4% of total earnings and life insurance of $35 per month . Requirement 2. Compute Worldwide’s total 2018 payroll tax expense for Wallace.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Liam Wallace is general manager of Worldwide Salons. During 2018Wallace worked for the company all 18, 1 year at a $ 12,900 monthly salary. He also earned a year-end bonus equal to 15% of his annual salary Wallace's federal income tax withheld during 2018 was $1,161 per month, plus $2,322 on his bonus check. State income tax withheld came to $170 per month , plus $110 on the bonus . FICA tax was withheld on the annual earnings . Wallace authorized the following payroll deductions : Charity Fund contribution of 4% of total earnings and life insurance of $35 per month .
Requirement 2. Compute Worldwide’s total 2018 payroll tax expense for Wallace.
Transcribed Image Text:Net pay
Gross pay
$ 178,020
Withholding deductions:
Federal income tax
Employee Medicare tax
Employee OASDI tax
State income tax
Charity fund contribution
Life insurance
Total withholdings
Net (take-home) pay
Transcribed Image Text:For all payroll calculations, use the following tax rates and round amounts to the
nearest cent
Employee:
OASDI: 6.2% on first $118,500 earned; Medicare: 1.45% up to
$200,000, 2.35% on earnings above $200,000.
OASDI: 6.2% on first $118,500 earned; Medicare: 1.45% on all
earnings; FUTA: 0.6% on first $7,000 earned; SUTA: 5.4% on first
$7,000 earned.
Employer
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