Tax Drill - Work Opportunity Credit During 2020, Lincoln Company hires seven individuals who are certified to be members of a qualifying targeted group. Each employee works in excess of 600 hours and is paid wages of $7,500 during the year. Lincoln Company's work opportunity credit is $

Tax Drill - Work Opportunity Credit During 2020, Lincoln Company hires seven individuals who are certified to be members of a qualifying targeted group. Each employee works in excess of 600 hours and is paid wages of $7,500 during the year. Lincoln Company's work opportunity credit is $

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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Bailey Dry Cleaners has six employees who were paid the following wages during 2019: Frank Johnson Frank Johnson $27,000 Bill Long 18,000 Duff Morse 130,000 Laura Stewart 28,000 Cindy Sharpe 26,000 Melissa Ledbetter 20,000 Total $249,000 The state allows the company a 1% unemployment compensation merit-rating reduction from the normal rate of 5.4%. The federal unemployment rate is 0.6%. The maximum unemployment wages per employee are $7,000 for both the state and the federal government. Income tax withholdings of 20% are applied to all employees. A F.I.C.A. tax rate of 8% on the employee and 8% on the employer is applied to the first $128,400 of each employee’s wages. Required: 1. Calculate the amount of payroll taxes to be paid by Bailey. 2. Prepare the journal entries to record the payment of payroll and the payroll tax expense.
During the first week of January, an employee works 50 hours. For this company, workers earn 150% of their regular rate for hours in excess of 40 per week. Her pay rate is $16 per hour, and her wages are subject to no deductions other than Federal Insurance Contributions Act (FICA) Social Security. Federal Insurance Contributions Act (FICA) Medicare, and federal income taxes. The tax rate for Social Security is 6.2% of the first $137,700 earned each calendar year and the Federal Insurance Contributions Act (FICA) tax rate for Medicare is 1.45% of all earnings. The current Federal Unemployment Taxes (FUTA) tax rate is 0.6%, and the State Unemployment Taxes (SUTA) tax rate is 5.4%. Both unemployment taxes are applied to the first $7,000 of an employee's pay. The employee has $80 ingrederal income taxes withheld. What is the amount of this employee's net pay for the first week of January? (Round your intermediate calculations to two decimal places.) Multiple Choice $732.68 $812.68 $147.32…
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An employee receives an hourly rate of $17, with time and a half for all hours worked in excess of 40 during a week. Payroll data for the current week are as follows: hours worked, 49; federal income tax withheld, $80; state income tax withheld is $22; social security tax rate, 6.2%; and Medicare tax rate, 1.45%. What is the net amount to be paid to the employee? Multiple Choice ) $737.92 $680.00 $909.50 $171.58
The employees of Sponsel Manufacturing achieved all of the sales goals for the current year. The company will pay the employees the promised bonus of 6% on annual net income, after deducting the bonus. The net income before the calculation of the bonus is $740,000. The journal entry to record the bonus owed to employees would be (round to the nearest dollar): C. Employee Bonus Payable Employee Bonus Expense 47,234 47,234 OD. Employee Bonus Expense Employee Bonus Payable 47,234 47,234 Click to select your answer. Show Transcribed Text ? The employees of Sponsel Manufacturing achieved all of the sales goals for the current year. The company will pay the employees the promised bonus of 6% on annual net income, after deducting the bonus. The net income before the calculation of the bonus is $740,000. The journal entry to record the bonus owed to employees would be (round to the nearest dollar): A. Employee Bonus Expense Employee Bonus Payable 41,887 41,887 B. Employee Bonus Payable…
Oregon Company's employees are eligible for retirement with benefits at the end of the year in which both age 60 is attained and they have completed 35 years of service. The benefits provide 15 years' reimbursement for health care services of $39,000 annually, beginning one year from the date of retirement. Ralph Young was hired at the beginning of 1988 by Oregon after turning age 22 and is expected to retire at the end of 2026 (age 60). The discount rate is 4 %. The plan is unfunded. The PV of an ordinary annuity of $1 where n = 15 and i = 4% is 11.11839. The PV of $1 where n = 2 and i = 4% is 0.92456. With respect to Ralph, what is the service cost to be included in Oregon's 2024 postretirement benefit expense, rounded to the nearest dollar? Multiple Choice $6,881 $ 12, 382 $39,000 $10, 280
An employee receives an hourly wage rate of $20, with time and a half for all hours worked in excess of 40 hours during a week. Payroll data for the current week are as follows: hours worked, 43; federal income tax withheld, $338; social security tax rate, 6.0%; and Medicare tax rate, 1.5% on all earnings. What is the gross pay for the employee? Select the correct answer. $890 $1,290 $1,720 $860
Toren Inc. employs one person to run its solar management company. The employee's gross income for the month of May is $7,208. Payroll for the month of May is as follows: • FICA Social Security tax rate at 6.2% FICA Medicare tax rate at 1.45% Federal income tax of $400 • State income tax of $75 Health-care insurance premium of $298 • Union dues of $50 • The employee is responsible for covering 14% of his or her health insurance premium What is the net pay of the one employee for the month of May? Round to the nearest penny, two decimals. # No new data to save. Last checked at 11:47pm Submit C
Sheffield Company began operations on January 2, 2019. It employs 10 individuals who work 8-hour days and are paid hourly. Each employee earns 10 paid vacation days and 8 paid sick days annually. Vacation days may be taken after January 15 of the year following the year in which they are earned. Sick days may be taken as soon as they are earned; unused sick days accumulate. Additional information is as follows. Actual HourlyWage Rate Vacation Days Usedby Each Employee Sick Days Usedby Each Employee 2019 2020 2019 2020 2019 2020 $6 $7 0 9 6 7 Sheffield Company has chosen to accrue the cost of compensated absences at rates of pay in effect during the period when earned and to accrue sick pay when earned. (a) Correct answer icon Your answer is correct Prepare journal entries to record transactions related to compensated absences during 2019 and 2020. (If no entry is required, select "No Entry" for the account…
Deep Mouse Designs has 14 employees within Denver City and County. The employees earned $9.80 per hour and worked 160 hours each during the month. The employer must remit $4.00 per month per employee who earns more than $500 per month. Additionally, employees who earn more than $500 per month must have $5.75 withheld from their pay. Required: What is the employee and employer Occupational Privilege Tax for these employees? (Round your answers to 2 decimal places.)
Ivanhoe Company has 60 employees who work 8-hour days and are paid hourly. On January 1, 2025, the company began a program of granting its employees 10 days of paid vacation each year. Vacation days earned in 2025 may first be taken on January 1, 2026. Information relative to these employees is as follows: Hourly Year Wages Vacation Days Earned by Each Employee Vacation Days Used by Each Employee 2025 $27.50 10 0 2026 29.50 10 8 2027 32.50 10 10 Ivanhoe has chosen to accrue the liability for compensated absences at the current rates of pay in effect when the compensated time is earned. What is the amount of the accrued liability for compensated absences that should be reported at December 31, 2027?
Indigo Corp. enters into a contract with a customer to build an apartment building for $1,061,800. The customer hopes to rent apartments at the beginning of the school year and provides a performance bonus of $139,200 to be paid if the building is ready for rental beginning August 1, 2021. The bonus is reduced by $46,400 each week that completion is delayed. Indigo commonly includes these completion bonuses in its contracts and, based on prior experience, estimates the following completion outcomes: Completed by August 1, 2021 August 8, 2021 August 15, 2021 After August 15, 2021 Transaction Price Probability 70 % Transaction Price $ 20 6 (a) Determine the transaction price for the contract, assuming Indigo is only able to estimate whether the building can be completed by August 1, 2021, or not (Indigo estimates that there is a 70% chance that the building will be completed by August 1, 2021). (If answer is O, please enter O. Do not leave any fields blank.) 4 (b) Determine the…