During 2018, Jeff Smallwood worked for two different employers. Until May, he wo

Question

During 2018, Jeff Smallwood worked for two different employers. Until May, he worked for Rowland Construction Company in Ames, Iowa, and earned $23,860. The state unemployment rate for Rowland is 4.6%. He then changed jobs and worked for Ford Improvement Company in Topeka, Kansas, and earned $27,290 for the rest of the year. The state unemployment rate for Ford is 5.1%. Determine the unemployment taxes (FUTA and SUTA) that would be paid by each company. Round your answers to the nearest cent.

Use Figure 5.1 to determine SUTA caps in Iowa and Kansas

Explanation / Answer

EXPLANATION --

Firstly we use Rate as - 0.6%=0.6/100=0.006

For Rowland Construction Company

Unemployment rate=4.6%=4.6/100=0.046

Amount earned=$23,860

For Ford Improvement Company

Unemployment rate=5.1%=5.1/100=0.051

Amount earned= $27,290

a) Rowland Construction Company =(23860*0.046)+(23860*0.006)

Rowland Construction Company=1097.56+143.16

Rowland Construction Company=$1,241

b)Ford Improvement Company =(27290*0.051)+(27290*0.006)

Ford Improvement Company =1391.79+163.74

Ford Improvement Company =$1,556

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