On 3 January, the company hired 3 employees: -Claire (sales staff): monthly gross salary 3,500 -Donald (storekeeper, handling the storage capacity): monthly gross salary 2,800 -Edith (managing director of the company): monthly gross salary 5,000

Salaries are paid out to employees on 27 January. The company shall consider an average income tax of 18% (Claire), 16% (Donald) and 21% (Edith). Furthermore, for all three employees, social security contributions of 38% apply; half of the contributions are to be borne by the employee and half by the employer. None of the three is member of a church. a) Calculate the January amount of income tax to be withheld by the company. Please show the way how you calculate; calculation results only will not be scored.

b) How much do the three employees cost their employer (in terms of expenses in the income statement)? Please show the way how you calculate; calculation results only will not be scored. In which line items of the income statement shall the company present the expense relating to the work of Claire, Donald and Edith?

c) Calculate the amount that each of the three employees shall receive in cash on January 27.

d) Please provide the relevant journal entries to account for the January payroll of the company in the following list of journal entries:

Date, Account name, Account type, Debit, Credit