1. 2. a. 1 Sally Thomas earns $22.00 per hour. This week, this employee worked 40 hours. Compute the gross pay AAN Gross Pay = $380.00 1 0 EMPLOYEE DEDUCTIONS The employee must contribute to a Social Security. b. Medicare and c. Federal Income Taxes a. Social Security Tax = 6% of wages earned. When the employee hits $100.000 for the year, the employer stops taking out Social Security Compute Social Security Tax Owed by Sally Thomas $ $52 80 b. Medicare Tax = 1.5% of all wages earned by the employee. Compute Medicare Tax Owed by Sally Thomas $13.20 Compute the Federal Income Tax Owed by the employee This can be a confusing calculation. We start by determining the number of withholding allowances for the employee The employee can claim ono allowance for himself or herself. Additionally, if the employee is married or has children. Dach family member is worth one withholding allowance The implication is that the more withholding allowanoes you olaim. the LOWER your inoome tan amount. Lorus assume that the omployee abovols SINGLE, and therefore has 1 withholding allowanoo. Sinc-ach allow C-duc-th-play-'swag-by $75. w- comput-th-w-g-xxubi-ct to withholding by subtr-aoting $75 From the employce's total wages. b. 1 We then consult the Wage Bracket Withholding I able shown below. For a SINGLE Person If the wage amount (after subtracting withholding allowances in The amount olingom lar to withhold is Not Over $12 $0 SO Ovvi Dut Nut Our ur Cxcess Ova 342 #214 FU 1072 #42 $214 $ $739 #BE. 15%. $214 *1,732 25 +799 $3.566 #111 282 $1.732 .... $7,703 ..... 33% $3,506 +7.795 *2,222, + 95% +7.703 tito 2234 + 39.60% $7,735 47 $141.00 U O Compute the Income Tax Owed by Sally Thomas Hint: the amount chieco withholding is hergrosspai minus $75 3. Make the Journal Entry Fill in the amount for each item from your answers above. Wages Expense Social Security Payable Medicare Payable Federal Income Tax withholding Payable Wages Payable O Enter Gross Pay O Enter Social Security Cirem 2a) O Line Media OLII Lim LI O Enter Withholding item Zol O Compute Wages Payable by subtracting the 3 liabilities from Wages Expense 1. 2. a. 1 Sally Thomas earns $22.00 per hour. This week, this employee worked 40 hours. Compute the gross pay AAN Gross Pay = $380.00 1 0 EMPLOYEE DEDUCTIONS The employee must contribute to a Social Security. b. Medicare and c. Federal Income Taxes a. Social Security Tax = 6% of wages earned. When the employee hits $100.000 for the year, the employer stops taking out Social Security Compute Social Security Tax Owed by Sally Thomas $ $52 80 b. Medicare Tax = 1.5% of all wages earned by the employee. Compute Medicare Tax Owed by Sally Thomas $13.20 Compute the Federal Income Tax Owed by the employee This can be a confusing calculation. We start by determining the number of withholding allowances for the employee The employee can claim ono allowance for himself or herself. Additionally, if the employee is married or has children. Dach family member is worth one withholding allowance The implication is that the more withholding allowanoes you olaim. the LOWER your inoome tan amount. Lorus assume that the omployee abovols SINGLE, and therefore has 1 withholding allowanoo. Sinc-ach allow C-duc-th-play-'swag-by $75. w- comput-th-w-g-xxubi-ct to withholding by subtr-aoting $75 From the employce's total wages. b. 1 We then consult the Wage Bracket Withholding I able shown below. For a SINGLE Person If the wage amount (after subtracting withholding allowances in The amount olingom lar to withhold is Not Over $12 $0 SO Ovvi Dut Nut Our ur Cxcess Ova 342 #214 FU 1072 #42 $214 $ $739 #BE. 15%. $214 *1,732 25 +799 $3.566 #111 282 $1.732 .... $7,703 ..... 33% $3,506 +7.795 *2,222, + 95% +7.703 tito 2234 + 39.60% $7,735 47 $141.00 U O Compute the Income Tax Owed by Sally Thomas Hint: the amount chieco withholding is hergrosspai minus $75 3. Make the Journal Entry Fill in the amount for each item from your answers above. Wages Expense Social Security Payable Medicare Payable Federal Income Tax withholding Payable Wages Payable O Enter Gross Pay O Enter Social Security Cirem 2a) O Line Media OLII Lim LI O Enter Withholding item Zol O Compute Wages Payable by subtracting the 3 liabilities from Wages Expense
