Payroll

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module_06_assignment.xlsx
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Written Exercise

Module 06 Written Exercise
For this exercise, perform an internet search, use your assigned reading or go to http://www.wisegeek.com/what-is-a-cafeteria-plan.htm and http://www.irs.gov/govt/fslg/article/0,,id=112720,00.html/ and http://www.401khelpcenter.com/401k_defined.html to answer the following questions:
Instructor Feedback
1 What is a cafeteria plan? What is a flexible spending account (FSA)? What is a health savings account (HSA)?
2 What are the differences between an FSA and an HSA?
3 What is a 401(k)?
4 What is the maximum amount an employee can contribute to a 401(k), FSA, and HSA?

Payroll Problems

Module 06 Payroll Problems
Problem 6.1
The hours worked and the hourly wages for several employees are listed
below. Calculate the gross earnings.
Employee Hours Worked Hourly Rate Regular Earnings Overtime Rate Overtime Earnings Total Gross Earnings Instructor comments
No. 1 45 $ 12.85
No. 2 39 $ 9.95
No. 3 41 $ 10.00
No. 4 40 $ 13.00
No. 5 50 $ 8.50
No. 6 40 $ 12.50
No. 7 43 $ 14.25
Problem 6.2
The schemes for matching employee contributions to retirement plans can vary.
The following employees elected to contribute the the company sponsored 401k.
Calculate their contributions based on the provided information. Assume that
the employer is matching .5% for every 1% contributed by employees.
Employee Employer Employee Employer
Contribution Contribution Biweekly Contribution Contribution Total
Employee Percentage Percentage Salary/Wages Amount Amount Contributions Instructor comments
No. 1 4.00% $ 1,846.15
No. 2 2.50% $ 1,153.85
No. 3 6.00% $ 2,915.38
No. 4 9.00% $ 3,560.77
No. 5 5.00% $ 1,730.77
No. 6 4.00% $ 2,205.77
No. 7 7.00% $ 2,440.38
Totals
Problem 6.3
The wags for several employees are listed below. Assume that the OASDI rate is 6.45% and the HI rate is 1.45%.
Determine the taxable wages for one biweekly pay period (two weeks) and determine the FICA taxes Instructor Feedback
for the employee and the employer.
Taxable FICA Taxes
Employee Wages Wages OASDI HI
No. 1 $725 weekly
No. 2 $850 weekly
No. 3 $3,500 monthly
No. 4 $4,300 monthly
No. 5 $5,200 semimonthly
No. 6 $62,000 annually
No. 7 $125,000 annually
Totals
Employer's OASDI
Employer's HI
Problem 6.4
Use the wage-bracket method to determine the federal income taxes to withhold from the wages and salaries of each employee. Instructor Feedback
Use the wage brackets found in the Publication 15 PDF file provided with the assignment file.
With-
Marital holding Amount
Employee Status Allow. Wages Withheld
No. 1 Single 3 $850 weekly
No. 2 Married 4 $2,800 biweekly
No. 3 Single 1 $2,000 biweekly
No. 4 Single 2 $2,100 semimonthly
No. 5 Married 7 $3,500 monthly