Accounting # Vulcan Company Tax Deposit PenaltiesVulcan Company is required to make monthly tax deposits. Their tax liability for March 20 is $2,505.### 1. Due Date for DepositThe due date for the deposit of these taxes is **April 15**.### 2. Penalty Computations for Late DepositAssume no deposit was made until April 29, which is 14 days late. The following penalties are computed:- **a. Penalty for Failure to Make Timely Deposit**: $125.50 (Incorrect)- **b. Penalty for Failure to Fully Pay Tax**: $12.53 (Correct)- **c. Interest on Taxes Due and Unpaid** (Assume a 6% interest rate): $4.80 (Incorrect)- **d. Total Penalty Imposed**: $142.58 (Incorrect)### Feedback Section**Check My Work**1. Determine the correct due date of the monthly deposit.2. Calculate the following: - a. Penalty for Failure to Make Timely Deposit - b. Penalty for Failure to Fully Pay Tax: ____ per month - c. Determine annual interest rate (based on 365 days): ____ - d. Equals the total penalty imposed: $_____You have 2 more Check My Work uses remaining._

As per IRC 6656, if penalties are not deposited in a timely manner or the deposits are made for less than the required amount then the penalty rates are as follows:- 2%-deposits made 1 to 5 days late 5%-deposits made 6 to 15 days late 10%-deposits made 16 days or more late but on or before the 10th day after the date of the first notice sent asking for the tax owed. 15%-amount still unpaid for more than 10 days after the date of the first notice sent by IRS or the day on which notice and demand for immediate payment is received, whichever is earlier. As per IRC 6651, the penalty for paying late is initially ½% of the unpaid tax shown on the return. It is charged each month or part of a month following the payment due date until the tax is paid. Total penalty cannot exceed 25%. As per IRC 6601, interest shall be charged on the amount owed starting from the due date of the return until the payment is made in full including all interest and penalty charges.