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Ehrlich Co. began business on January 2, 20Y8. Salaries were paid to employees on the last day of each month, and social security tax, Medicare tax, and federal income tax were withheld in the required amounts. An employee who is hired in the middle of the month receives half the monthly salary for that month. All required payroll tax reports were filed, and the correct amount of payroll taxes was remitted by the company for the calendar year. Early in 20Y9, before the Wage and Tax Statements (Form W-2) could be prepared for distribution to employees and for filing with the Social Security Administra- tion, the employees' earnings records were inadvertently destroyed. None of the employees resigned or were discharged during the year, and there were no changes in salary rates. The social security tax was withheld at the rate of 6.0% and Medicare tax at the rate of 1.5%. Data on dates of employment, salary rates, and em- ployees' income taxes withheld, which are summarized as follows, were obtained from personnel records and payroll records: Monthly Income Tax Monthly Salary $ 5,500 Date First Employee Employed Withheld $ 944 Arnett Nov. 16 Cruz Jan. 2 4,800 833 Oct. 1 Edwards 1,592 8,000 Harvin Dec. 1 6,000 1,070 Feb. 1 Nicks 10,000 2,350 Shiancoe 11,600 Mar. 1 2,600 Ward 5,220 Nov. 16 876 Instructions 1. Calculate the amounts to be reported on each employee's Wage and Tax Statement (Form W-2) for 20Y8, arranging the data in the following form: Social Security Tax Withheld Gross Federal Income Tax Withheld Medicare Tax Withheld Employee Earnings 2. Calculate the following employer payroll taxes for the year: (a) social security; (b) Medicare; (c) state unemployment compensation at 5.4% on the first $10,000 of each employee's earnings; (d) federal unemployment compensation at 0.6% on the first $10,000 of each employee's earnings; (e) total.

Ehrlich Co. began business on January 2, 20Y8. Salaries were paid to employees on the last day of each month, and social security tax, Medicare tax, and federal income tax were withheld in the required amounts. An employee who is hired in the middle of the month receives half the monthly salary for that month. All required payroll tax reports were filed, and the correct amount of payroll taxes was remitted by the company for the calendar year. Early in 20Y9, before the Wage and Tax Statements (Form W-2) could be prepared for distribution to employees and for filing with the Social Security Administra- tion, the employees' earnings records were inadvertently destroyed. None of the employees resigned or were discharged during the year, and there were no changes in salary rates. The social security tax was withheld at the rate of 6.0% and Medicare tax at the rate of 1.5%. Data on dates of employment, salary rates, and em- ployees' income taxes withheld, which are summarized as follows, were obtained from personnel records and payroll records: Monthly Income Tax Monthly Salary $ 5,500 Date First Employee Employed Withheld $ 944 Arnett Nov. 16 Cruz Jan. 2 4,800 833 Oct. 1 Edwards 1,592 8,000 Harvin Dec. 1 6,000 1,070 Feb. 1 Nicks 10,000 2,350 Shiancoe 11,600 Mar. 1 2,600 Ward 5,220 Nov. 16 876 Instructions 1. Calculate the amounts to be reported on each employee's Wage and Tax Statement (Form W-2) for 20Y8, arranging the data in the following form: Social Security Tax Withheld Gross Federal Income Tax Withheld Medicare Tax Withheld Employee Earnings 2. Calculate the following employer payroll taxes for the year: (a) social security; (b) Medicare; (c) state unemployment compensation at 5.4% on the first $10,000 of each employee's earnings; (d) federal unemployment compensation at 0.6% on the first $10,000 of each employee's earnings; (e) total.

College Accounting (Book Only): A Career Approach
College Accounting (Book Only): A Career Approach
13th Edition
ISBN:9781337280570
Author:Scott, Cathy J.
Publisher:Scott, Cathy J.
Chapter8: Employer Taxes, Payments, And Reports
Section: Chapter Questions
Problem 4E
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Ehrlich Co. began business on January 2, 20Y8. Salaries were paid to employees on the last day of each month, and social security tax, Medicare tax, and federal income tax were withheld in the required amounts. An employee who is hired in the middle of the month receives half the monthly salary for that month. All required payroll tax reports were filed, and the correct amount of payroll taxes was remitted by the company for the calendar year. Early in 20Y9, before the Wage and Tax Statements (Form W-2) could be prepared for distribution to employees and for filing with the Social Security Administra- tion, the employees' earnings records were inadvertently destroyed. None of the employees resigned or were discharged during the year, and there were no changes in salary rates. The social security tax was withheld at the rate of 6.0% and Medicare tax at the rate of 1.5%. Data on dates of employment, salary rates, and em- ployees' income taxes withheld, which are summarized as follows, were obtained from personnel records and payroll records: Monthly Income Tax Monthly Salary $ 5,500 Date First Employee Employed Withheld $ 944 Arnett Nov. 16 Cruz Jan. 2 4,800 833 Oct. 1 Edwards 1,592 8,000 Harvin Dec. 1 6,000 1,070 Feb. 1 Nicks 10,000 2,350 Shiancoe 11,600 Mar. 1 2,600 Ward 5,220 Nov. 16 876 Instructions 1. Calculate the amounts to be reported on each employee's Wage and Tax Statement (Form W-2) for 20Y8, arranging the data in the following form: Social Security Tax Withheld Gross Federal Income Tax Withheld Medicare Tax Withheld Employee Earnings 2. Calculate the following employer payroll taxes for the year: (a) social security; (b) Medicare; (c) state unemployment compensation at 5.4% on the first $10,000 of each employee's earnings; (d) federal unemployment compensation at 0.6% on the first $10,000 of each employee's earnings; (e) total.
Transcribed Image Text:Ehrlich Co. began business on January 2, 20Y8. Salaries were paid to employees on the last day of each month, and social security tax, Medicare tax, and federal income tax were withheld in the required amounts. An employee who is hired in the middle of the month receives half the monthly salary for that month. All required payroll tax reports were filed, and the correct amount of payroll taxes was remitted by the company for the calendar year. Early in 20Y9, before the Wage and Tax Statements (Form W-2) could be prepared for distribution to employees and for filing with the Social Security Administra- tion, the employees' earnings records were inadvertently destroyed. None of the employees resigned or were discharged during the year, and there were no changes in salary rates. The social security tax was withheld at the rate of 6.0% and Medicare tax at the rate of 1.5%. Data on dates of employment, salary rates, and em- ployees' income taxes withheld, which are summarized as follows, were obtained from personnel records and payroll records: Monthly Income Tax Monthly Salary $ 5,500 Date First Employee Employed Withheld $ 944 Arnett Nov. 16 Cruz Jan. 2 4,800 833 Oct. 1 Edwards 1,592 8,000 Harvin Dec. 1 6,000 1,070 Feb. 1 Nicks 10,000 2,350 Shiancoe 11,600 Mar. 1 2,600 Ward 5,220 Nov. 16 876 Instructions 1. Calculate the amounts to be reported on each employee's Wage and Tax Statement (Form W-2) for 20Y8, arranging the data in the following form: Social Security Tax Withheld Gross Federal Income Tax Withheld Medicare Tax Withheld Employee Earnings 2. Calculate the following employer payroll taxes for the year: (a) social security; (b) Medicare; (c) state unemployment compensation at 5.4% on the first $10,000 of each employee's earnings; (d) federal unemployment compensation at 0.6% on the first $10,000 of each employee's earnings; (e) total.
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