ACCOUNTING 1010 CHAPTERS 8-11 Page 3 If an asset originally purchased for $75,00

Question

ACCOUNTING 1010 CHAPTERS 8-11 Page 3 If an asset originally purchased for $75,000 had accumulated depreciation totaling $20,000 what is the amount of gain or loss on the sale of the asset if the asset is sold for $60,000? All payroll questions share the same general information regarding payroll taxes FICA taxes include both Social Security and Medicare taxes 6.0% Social Security tax rate on all earnings 1.5% Medicare tax rate on all earnings 5.4% State unemployment tax rate on the first $7,000 in earnings 0.8% Federal unemployment tax rate on the first $7,000 in earnings 14 An employee receives an hourly rate of $18, with time and one half for all hours in excess of 40 during the week. The employee's payroll data for the current week are as follows: Hours worked, 46 Federal income tax withheld, $190 Cumulative earnings are zero as this is the first pay period of the year. I. What is the gross pay for the employee? II. What are the total deductions? III. What is the net pay for the employee? IV. What is the employer's total payroll tax expense for this employee during this one pay period?

Explanation / Answer

13.Asset purchase price = $ 75000

Accumulated Depreciation = $ 20000

Current Value = $ 55000

Sell price = $ 60000

Gain = $ 5000

Answer to Question 14

1. Gross pay = $18 * 40 + $18 * 1.5 * 6 = $ 882

2. Total Deduction = federal income tax withheld + social security tax + medicare tax

= $ 190 + $ 52.92 (882x6%) + $ 13.23 (882x1.50%) = $ 256.15

3. Salary Payable = $ 882 - $ 256.15 = $ 625.85

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