Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Use the following tax rates, ceiling and maximum taxes: Employee and Employer OASDI: 6.20% $127,200 $7,886.40 Employee* and Employer HI: 1.45% No limit No maximum

Use the following tax rates, ceiling and maximum taxes:
Employee and Employer OASDI: 6.20% $127,200 $7,886.40
Employee* and Employer HI: 1.45% No limit No maximum
Self-employed OASDI: 12.4% $127,200 $15,772.80
Self-employed HI: 2.9% No limit No maximum

*Employee HI: Plus an additional 0.9% on wages over $200,000. Also applicable to self-employed.

Rounding Rules: Unless instructed otherwise compute hourly rate and overtime rates as follows:

Carry the hourly rate and the overtime rate to 3 decimal places and then round off to 2 decimal places (round the hourly rate to 2 decimal places before multiplying by one and one-half to determine the overtime rate).

If the third decimal place is 5 or more, round to the next higher cent.

If the third decimal place is less than 5, drop the third decimal place.

Also, use the minimum hourly wage of $7.25 in solving these problems and all that follow.

On the last weekly pay of the first quarter, Lorenz is paid her current pay of $90 per day for four days worked and one day sick pay (total $450). She is also paid her first-quarter commission of $1,200 in this pay. How much will be deducted for: Round your answers to the nearest cent.

a. OASDI tax $_______
b. HI tax $_________

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting and auditing research tools and strategies

Authors: Thomas Weirich, Thomas Pearson, Natalie Tatiana

8th edition

9781118806487, 1118027078, 1118806484, 978-1118027073

More Books

Students also viewed these Accounting questions

Question

What are the insureds major duties after a loss?

Answered: 1 week ago