ing uuing the final quarter . ThanksgMng day and the day after, Thursday and Fri
ID: 2584925 • Letter: I
Question
ing uuing the final quarter . ThanksgMng day and the day after, Thursday and Friday November 24-25 - Christmas, which is a Sunday. When holdays occur on a weekend, the preceding Friday, Decenber 23, Is considered a hollday. Employees recelve holiday pay for Monday, December 26. For the completton of this project, refer to the tax-related information in the table below. For federal withholding calculations, use the percentage method tables in Appendix C, which is provided below. For Utah state withholding calculations, use the Utah Schedule 3 tax tables linked below (ensure to use the appropriate Utah table based on each employee's martal status) Both 40100 and Insurance are pretax for federal income tax and Utah income tax Federal withholding Allowance (less 401 $168.88 per allowance claimed (k), Section 125) Semimonthly Federal Percentage Method Tax Table Federal Unemployment Rate (employer only) 0.6% on the first $7,000 of wages (less Section 125) State withholding Rate (less 401(k) Section 125) State Unemployment Rate (employer only) (less Section 125) $168.80 per allowance claimed Appendix-C Page 254 Table #3 See Utah Schedule. 3, Table 1 or use the Excel version of Schedule 3 2.6% on the first $32,200 of wages The balance sheet for WCW as of November 30, 2016, is as follows Wayland Custom woodworking Balance Sheet 11/30/2016 Liabilities & Equity Asset5 51,086,269.51 Accounts Payable 10, Cash Supplies Office Equipment Inventory 10,283.15Salaries and Wages Payable 130, 202 16 Federal Unemployment Tax Payable 221 163.81Social Security Tax PayableExplanation / Answer
Federal unemployment tax and state unemployment taxes are payable by the employer on the gross earning of each & employee. The limit of first $7,000 & $32,200 is basically per employee limit given by the IRS and therefore, in the given case no person is having wages more than that. We are required to calculate the FUTA & SUTA at the gross earnings of the employees.
Federal Unemployment Tax Payable - $12,720 x 0.6% = $76.32
State Unemployment Tax Payable - $12,720 x 2.6% = $330.72
NOTE: We can take credit of amount of tax paid as SUTA from federal unemployment tax Eg. if we have SUTA rate of 5.4% in florida, and FUTA rate of 6.2%, then employer can take credit of SUTA and then FUTA payable will be only 0.8%. But in our question, SUTA rate is already higher than the FUTA and therefore, it is assumed that actual FUTA rate was 0.6+2.6 = 3.2% and SUTA was 2.6%. and we are provided net FUTA rate only in the question.
Kindly inform me if the abover answer is wrong.
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