Jocame Inc. began business on January 2,2013. salaries were paid to employees on the last day of each month, and social security tax, Medicare tax, and federal income tax were withheld in the required amounts. an employee who is hired in the middle of the month receives half the monthly salary for that month. all required payroll tax reports were filed, and the correct amount of payroll taxes taxes was remitted by the company for the calendar year. early in 2014, before the wage and tax statements( form W2) could be prepared for distribution to employees and for filing with the social security administration, the employees earnings records were inadvertently destroyed.
None of the employees resigned or were discharged during the year, and there were no changes in salary rates. the social security tax was withheld at the rate of 6% and Medicare tax at the rate of 1.5% on salary. data on dates of employment employment , salary rates, and employees income tax withheld , which are summarized as follows, were obtained from personal records and payroll records.
| Employees |
Date first employed |
Monthly Salary |
Monthly Income Withheld |
| Addai |
July 16 |
$8,160 |
$1,704 |
| Kasay |
June 1 |
3,600 |
533 |
| McGahee |
Feb 16 |
6,420 |
1,238 |
| Moss |
Jan 1 |
4,600 |
783 |
| Stewart |
Dec 1 |
4,500 |
758 |
| Tolbert |
Nov 16 |
3,250 |
446 |
| Wells |
May 1 |
10,500 |
2,359 |
Instructions:
1. Calculate the amounts to be reported on each employees wage and tax statement (form W2) for 2013, arranging the data in the following form:
Employees Gross Earnings Federal Income tax withheld Social security tax withheld Medicare tax withheld
2. Calculate the following employer payroll taxes for the year :
(a) Social security ,
(b) Medicare,
(c) state unemployment at 5.4% on the first $10,000 of each employees earnings,
( d) federal unemployment compensation at 0.8% on the first $10,000 of each employees earnings,
(e) total.