The two employees at Oswald Co. receive various fringe benefits. Oswald Co. provides vacation at the rate of $500 per day, and each employee earns one day of vacation per month worked. In addition, Oswald Co. pays a total amount of $780 per month in medical insurance premiums. Oswald also contributes a total amount of $400 per month into an employee retirement plan. The federal unemployment tax rate is 6%, while the state unemployment tax rate is 4.5%. Unemployment taxes apply to the first $7,000 of earnings per employee. Assume a Social Security tax rate of 6.0% and a Medicare tax rate of 1.5%.

Required
a. Prepare the computation for the accrued fringe benefits per month.
b. Show the effect of accrued fringe benefits per month on a statements model like the one shown next:

c. If the two employees each worked 250 days for the year, what is Oswald Co.’s total payroll cost (salary, payroll taxes, and fringe benefits) for the year? (Assume that each employee earns $500 per day.)

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Balance Sheet Statement of Cash Income Statement Assets Llabilities Stk. Equlty Com. Stk. Flows Cash Varlous Payables Net Inc. Ret. Earn. Exp. Rev.