Peroni Company paid wages of $160,100 this year. Of this amount, $114,700 was taxable for net...

Peroni Company paid wages of $160,100 this year. Of this amount, $114,700 was taxable for net FUTA and SUTA purposes. The state's contribution tax rate is 3.1% for Peroni Company. Due to cash flow problems, the company did not make any SUTA payments until after the Form 940 filing date. Compute the following; round your answers to the nearest cent.

a. Amount of credit the company would receive against the FUTA tax for its SUTA contributions
$________

b. Amount that Peroni Company would pay to the federal government for its FUTA tax
$_________

c. Amount that the company lost because of its late payments
$__________

Expert Solution

Answer-a.-

Amount of credit the company would receive against the FUTA tax for its SUTA contributions

Particulars	Amount (in $)
Credit ($114,7003.1%90%)	$3,200.13
Add: Additional credit ($114,700*0.023)	$2,638.10
Total FUTA Tax Credit	$5,838.23

b-Amount that Peroni Company would pay to the federal government for its FUTA tax

Particulars	Amount ($)
Tax ($114,700*0.060)	$6,882
Less: Credit against tax	$5,838.23
Net FUTA Tax	$1,043.77

c-Amount that the company lost because of its late payments

Particulars	Amount ($)
NET-FUTA Tax	$1,043.77
Less: FUTA Tax without penalty ($114,700*0.0060)	$688.20
Penalty	$355.57

ekkarill92 answered 2 years ago

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