Sky Company employed Tom Mills in Year 1. Tom earned $4,900 per month and worked the entire year. Assume the Social Security tax rate is 6 percent for the first $110,000 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 payroll taxes? (3) What is the total payroll tax expense for Sky Company for January Year 1? February Year 1? March Year 1? December Year 1? b. Assume that instead of $4,900 per month Tom earned $9,800 per month. 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 Company for January Year 1? February Year 1? March Year 1? December Year 1? Complete this question by entering your answers in the tabs below. Req A1 Req A2 Req A3 January to November (per month) December Req B1 Req B2 Assume that instead of $4,900 per month Tom earned $9,800 per month. What is Tom's net pay? (Round your answers to 2 decimal places.) Net Pay $ 8,145.00 Req B3
Sky Company employed Tom Mills in Year 1. Tom earned $4,900 per month and worked the entire year. Assume the Social Security tax rate is 6 percent for the first $110,000 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 payroll taxes? (3) What is the total payroll tax expense for Sky Company for January Year 1? February Year 1? March Year 1? December Year 1? b. Assume that instead of $4,900 per month Tom earned $9,800 per month. 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 Company for January Year 1? February Year 1? March Year 1? December Year 1? Complete this question by entering your answers in the tabs below. Req A1 Req A2 Req A3 January to November (per month) December Req B1 Req B2 Assume that instead of $4,900 per month Tom earned $9,800 per month. What is Tom's net pay? (Round your answers to 2 decimal places.) Net Pay $ 8,145.00 Req B3
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
H1
Transcribed Image Text:Sky Company employed Tom Mills in Year 1. Tom earned $4,900 per month and worked the entire year. Assume the Social Security tax
rate is 6 percent for the first $110,000 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 payroll taxes?
(3) What is the total payroll tax expense for Sky Company for January Year 1? February Year 1? March Year 1? December Year 1?
b. Assume that instead of $4,900 per month Tom earned $9,800 per month. 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 Company for January Year 1? February Year 1? March Year 1? December Year 1?
Complete this question by entering your answers in the tabs below.
Req A1
Req A2
Req A3
January to November (per month)
December
Req B1
Req B2
Assume that instead of $4,900 per month Tom earned $9,800 per month. What is Tom's net pay? (Round your answers to 2
decimal places.)
Net Pay
$ 8,145.00
Req B3
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