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The payroll of Olsen Company for December 2023 is as follows: Total payroll was $800,000, of which $380,000 represents amounts paid in excess of $118,500
The payroll of Olsen Company for December 2023 is as follows: Total payroll was $800,000, of which $380,000 represents amounts paid in excess of $118,500 to certain employees. Income taxes in the amount of $210,000 were withheld, as was $20,000 for employee dependent insurance and $3,000 for union dues. Assume that the FICA tax is 7.65% on an employee's wages to $118,500 and 1.45% in excess of $118,500. The amount paid to employees in excess of $7,000 was $700,000. State and Federal Unemployment Taxes are only paid on the first $7,000 paid to individual employees. The State Unemployment Tax rate is 3.6%, but Olsen Company is allowed a credit of 1.4% by the state for its unemployment experience. The Federal Unemployment Tax rate is .9% after state credit
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