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# rng co. has one employee and the company is subject to the f

rng co. has one employee and the company is subject to the following taxes

fica-social security ........6.20%   first \$ 102000
fica-medicare.................1.45   all gross pay
futa..........................0.80    first \$7000
suta..........................2.90    first \$7000

compute RNG's amounts for each o these four taxes as applied to the employee's gross earnings for september under each of three separate situations a, b, and c.

grosspay           gross pay
through august      pay for september

a. \$ 5900           \$ 2100
b. \$ 17,700            2500
c. \$ 95700             7400
HiCustomerbr />

a)

Total Pay till September = 5900 + 2100 = 8000

Fica-social security ........= 2100*6.20% = \$130.2
fica-medicare.................=2100*1.45% = \$30.45
futa..........................1100*0.80%= \$8.8
suta..........................1100*2.90%=\$31.9

b)

Total Pay till September =17,700+2500=20,200

Fica-social security ........= 2500*6.20% = \$155.00
fica-medicare.................=2500*1.45% = \$ 36.25
futa.......................... Zero (As its paid only on first 7000 and gross pay till August exceed 7000)

suta..........................Zero (As its paid only on first 7000 and gross pay till August exceed 7000)

c)

Total Pay till September =95700+7400=103100

Fica-social security ........= 6300*6.20% = \$390.6
fica-medicare.................=7400*1.45% = \$107.3
futa..........................Zero (As its paid only on first 7000 and gross pay till August exceed 7000)
suta..........................Zero (As its paid only on first 7000 and gross pay till August exceed 7000)

Regards

Linda

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Edited by linda_us on 10/18/2009 at 12:28 AM EST