Question

Rock Adventures has 15 employees each working 40 hours per week and earning $30 an hour. Federal income taxes are withheld at 15% and state income taxes at 6%. FICA taxes are 7.65% and unemployment taxes are 3.8% of the first $7,000 earned per employee. What is the actual payroll payment (salaries payable) for the first week of January

Answer 1

Answer: $12,843

Explanation:

Given Data:

Employees = 15

Earnings/ hr = $30

Federal income taxes = 15%

state income taxes = 6%.

FICA taxes = 7.65%

unemployment taxes = 3.8% of the first $7,000 earned per employee.

1. Gross wages

= 15 * 30 * 40 = $18000

2. Federal income tax

= $18000 * 0.15 = $2700

3. State income tax

= $18000 * 0.06 = $1080

4. Fica taxes

= $18000 * 0.0765 = $1377

Total taxes

= $1377 + $1080 + $2700

= $5157

Actual payroll payment

= $18000 - $5157

= $12,843