Assignment 6 - Chapter 10 Your company is hiring a new CIO, Anita Mack, effective January 1, 2020 and you have been asked to come up with some information related to this hire. The annual salary for the CIO position is $175,000. Other information that you have gathered related to the new CIO is as follows: Anita has elected to obtain the company's medical insurance offering and have her share of the premium deducted from her pay. The total medical insurance premium is $1,500 per month, of which one-half is paid by the company. Anita has also elected to contribute 12% of her salary to the company's 401(K) plan. As a retirement benefit the company will also contribute to an employee's 401(K) with a match of up to 5% of an employee's salary. Anita's employer also provides a defined contribution pension plan with a contribution equal to 10% of her salary. Anita has elected to deduct $200 per month from her check that will go to various charities. Tax information is as follows: FIT: Assume a rate of 20% of taxable earnings FICA: To calculate the social security portion of FICA, use the 2020 wage base limit provided by the IRS. The IRS also provides tax rates for social security and Medicare. To help with your research, go to IRS.gov and find Publication 15. There you will find the wage base limit for social security tax and the tax rates for social security and Medicare. Unemployment Taxes: Use Tennessee's taxable wage base of S9,000 for calculating the SUTA tax with an assumed rate of 5.4%. Use the federal taxable wage base of $7,000 for calculating the FUTA tax with an assumed rate of 0.8%. Required: A) Prepare a schedule showing Anitas projected 2020 gross pay, taxable earnings, and net pay. (Make sure you list each deduction) B) Prepare a schedule showing the total projected 2020 cost to the company for hiring Anita. (Each cost should be displayed in the schedule) Assignment 6 - Chapter 10 Your company is hiring a new CIO, Anita Mack, effective January 1, 2020 and you have been asked to come up with some information related to this hire. The annual salary for the CIO position is $175,000. Other information that you have gathered related to the new CIO is as follows: Anita has elected to obtain the company's medical insurance offering and have her share of the premium deducted from her pay. The total medical insurance premium is $1,500 per month, of which one-half is paid by the company. Anita has also elected to contribute 12% of her salary to the company's 401(K) plan. As a retirement benefit the company will also contribute to an employee's 401(K) with a match of up to 5% of an employee's salary. Anita's employer also provides a defined contribution pension plan with a contribution equal to 10% of her salary. Anita has elected to deduct $200 per month from her check that will go to various charities. Tax information is as follows: FIT: Assume a rate of 20% of taxable earnings FICA: To calculate the social security portion of FICA, use the 2020 wage base limit provided by the IRS. The IRS also provides tax rates for social security and Medicare. To help with your research, go to IRS.gov and find Publication 15. There you will find the wage base limit for social security tax and the tax rates for social security and Medicare. Unemployment Taxes: Use Tennessee's taxable wage base of S9,000 for calculating the SUTA tax with an assumed rate of 5.4%. Use the federal taxable wage base of $7,000 for calculating the FUTA tax with an assumed rate of 0.8%. Required: A) Prepare a schedule showing Anitas projected 2020 gross pay, taxable earnings, and net pay. (Make sure you list each deduction) B) Prepare a schedule showing the total projected 2020 cost to the company for hiring Anita. (Each cost should be displayed in the schedule)
