PRAU6A1P2
jfmysjvfes691981Work on the Continuing Payroll Problem Project A
Complete this week's portion of the Continuing Payroll Problem A, which can be found at the end of Chapter 5 (page 5-55).
To complete this project you are required to utilize the template.
You are to complete this portion of the Continuing Payroll Problem and submit to the Continuing Payroll Project Dropbox. You will earn 10 points for the completion of this portion of the Continuing Payroll Problem A and not for accuracy. Your work will not be graded this week but awarded 10 completion points.
CONTINUING PAYROLL PROBLEM • A
Refer to the partially completed payroll register that you worked on at the end of Chapter 4. You will now compute the employer's liability for unemployment taxes (FUTA and SUTA) for the pay of January 14. These computations will be used at the end of Chapter 6 in recording the payroll tax entries.
To compute the employer's liability for unemployment taxes, proceed as follows:
1. Enter each employee's gross earnings in the Taxable Earnings—FUTA and SUTA columns.
2. Total the Taxable Earnings—FUTA and SUTA columns.
3. At the bottom of your payroll register, compute the following:
a. Net FUTA tax. Since this is the first pay period of the year, none of the employees are near the $7,000 ceiling; therefore, each employee's gross earnings is subject to the FUTA tax.
b. SUTA tax. Since Kipley Company is a new employer, Pennsylvania has assigned the company a contribution rate of 3.6785% on the first $8,500 of each employee's earnings. Employees pay 0.07% on total gross pay.
Note: Retain your partially completed payroll register for use at the end of Chapter 6.
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