The auditors of TQ, Inc., a calendar-year corporation, obtained the selected information for years 1 and 2 located on the Financial Information tab.

The auditors are performing analytical procedures relative to the expectations of expenses for year 2 and have established a materiality threshold of 5% of the year 2 account balance. For each of the accounts in column A below, consider the additional notes in column B and the information in the Financial Information tab, and:

In column C, enter the auditor's expectation of year 2 expense.

Round all amounts to the nearest dollar.

Consider each account independently.

Expense	Additional note	Auditors expectations
Bonus-expense	Bonus expense for year 2 is expected to be 7% of total prior-year wage and salary expense if total unit sales increase by ore that 5%
Short-term disability expense	Short-term disability expense for year 2 is expected to be 2% of the prior year wage and salary expense.
Office salary expense	Average salaries increased 4% effective July 1, year 2. Headcount was 40 in year 1 and increased to 48 on July 1, year 2.
401(k) match expense	TQ matches 50 of the first 6% of total current-year compensation (salaries,wages,and bonuses) for participating employees. Historically, 80% of TQs employees have participated in the 401(k) plan.
Hourly payroll tax expense	Historically, hourly payroll tax expense, excluding federal unemployment tax, has been 8% of total wages. In addition federal unemployment tax was expected to increase on October 1, year 2, from 1% to 2%. Total hourly payroll is expected to increase by 2%.
Health insurance expense	Total headcount was 200 employees for year 1 and 260 for year 2. Health insurance premium are expected to increase 12% in year 2.

The auditors of TQ, Inc., obtained the following selected account information.

Selected information	Year 2	Year 1
Sales revenue	$63,000,000	$60,000,000
Hourly wage expense	$12,340,000	$12,000,000
Office salary expense	$5,092,500	$4,850,000
Bonus expense	$1,315,000	$1,250,000
Payroll tax expensehourly	$1,114,200	$1,080,000
Payroll tax expenseoffice	$458,000	$436,500
401(k) match expense	$410,000	$407,000
Health insurance expense	$377,500	$265,000
Short-term disability expense	$340,000	$350,000

Additionally, the auditors noted the following information:

	Year 1 unit sales of Product Alpha: 25,000
	Year 1 unit sales of Product Beta: 45,000
	Unit sales increased in year 2 by 10% and 6% for Product Alpha and Product Beta, respectively.