arnings FUTA and SUTA columns. dlnings in the Taxable $9,500 of each employee's earnings. Employees pay 0.07% on total gross pay. Toral the Taxable Earnings-FUTA and SUTA columns. Note: Retain your partially completed payroll register for use at the end of Chapter 6. 3. At the bottom of your payroll register, compute the following: CASE PROBLEM C1. Reducing a High Unemployment Tax Rate. Over the past two years, Kermit Stone, the controller of has filed a claim for unemployment benefits. By signing Hilton Company, has been concerned that the company these reports "blindly," the company, in effect, tells the has been paying a large amount of money for state unem- state that the employee is eligible for the benefits. Any ployment taxes. On reviewing the "unemployment file" benefits paid are charged by the state against Hilton with the head accountant, Deborah Murtha, he learns Company's account. that the company's tax rate is near the top of the range of Stone is the state's experience-rating system. The eligibility reports are notices that an convinced that the rates the company is pay- ing are too high, and he feels that part of the reason is After calling the local unemployment office, Stone the "blind" signing of the eligibility reports. Besides this, realizes that the turnover of employees at Hilton Com- he wonders what other steps the company can take pany has had an adverse effect on the company's tax lower its contributions rate and taxes rates. In addition, after consulting with Murtha, he dis- Submit recommendations that might help Stone covers that the eligibility reports that come from the state reduce the "unfair" burden that the unemployment com unemployment office are just signed and sent back to the pensation taxes are leveling on Hilton Company. state without any review. to 5-57