None Sky Co. employed Tom Mills in Year 1. Tom earned $5,400 per month and worked the entire year. Assume the Social Security tax rate is6 percent for the first $130,000 of earnings, and the Medicare tax rate is 1.5 percent. Tom's federal income tax withholding amount is$920 per month. Use 5.4 percent for the state unemployment tax rate and 0.6 percent for the federal unemployment tax rate on thefirst $7,000 of earnings per employee.Requireda. Answer the following questions:1. What is Tom's net pay per month?2. What amount does Tom pay monthly in FICA taxes?3. What is the total payroll tax expense for Sky Co. for January, Year 1? February, Year 1? March, Year 1? December, Year 1?b. Assume that instead of $5,400 per month Tom earned $10,900 per month. Based on this new level of income Tom's new federalincome tax withholding is $2,000. Answer the following questions.1. What is Tom's net pay per month?2. What amount does Tom pay monthly in FICA payroll taxes?3. What is the total payroll tax expense for Sky Co. for January, Year 1? February, Year 1? March, Year 1? December, Year 1?Complete this question by entering your answers in the tabs below.Required A1 Required A2 Required A3 Required B1 Required B2 Required B3What is Tom's net pay per month? (Round your answer to 2 decimal places.)Tom's net payper month

Payroll tax: A payroll tax is a tax withheld from an employee's salary by an employer who remits it…

Sky Co. employed Tom Mills in Year 1. Tom earned $5,400 per month and worked the entire year. Assume the Social Security tax rate is 6 percent for the first $130,000 of earnings, and the Medicare tax rate is 1.5 percent. Tom's federal income tax withholding amount is $920 per month. Use 5.4 percent for the state unemployment tax rate and 0.6 percent for the federal unemployment tax rate on the first $7,000 of earnings per employee. Required a. Answer the following questions: 1. What is Tom's net pay per month? 2. What amount does Tom pay monthly in FICA taxes? 3. What is the total payroll tax expense for Sky Co. for January, Year 1? February, Year 1? March, Year 1? December, Year 1?

Sky Co. employed Tom Mills in Year 1. Tom earned $5,400 per month and worked the entire year. Assume the Social Security tax rate is 6 percent for the first $130,000 of earnings, and the Medicare tax rate is 1.5 percent. Tom's federal income tax withholding amount is $920 per month. Use 5.4 percent for the state unemployment tax rate and 0.6 percent for the federal unemployment tax rate on the first $7,000 of earnings per employee. Required a. Answer the following questions: 1. What is Tom's net pay per month? 2. What amount does Tom pay monthly in FICA taxes? 3. What is the total payroll tax expense for Sky Co. for January, Year 1? February, Year 1? March, Year 1? December, Year 1?

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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