Question

Continuing Payroll Problem, 4B: Chapter 4

This problem continues the process of preparing the Olney Company's Employee Payroll Register for the pay period ending January 8th, 20--. In previous chapters, gross wages were computed for each employee and using this data, FICA withholding and employer FICA liability was computed. This information is shown in the Employee Payroll Register.

Requirement:

Refer to the SIMPLE Plan Contributions table and enter each employee's SIMPLE plan deduction.

Determine and record the federal income taxes for each employee.

Determine and record the state income taxes for each employee.

Determine and record the city income taxes for the city of Allentown.

Total each input column.

SIMPLE Plan Contributions

A SIMPLE IRA is a retirement plan that may be established by employers, including self-employed individuals (sole proprietorships and partnerships). The SIMPLE IRA allows eligible employees to contribute part of their pretax compensation to the plan. This means the tax on the money is deferred until it is distributed.^a

OLNEY COMPANY, INC. SIMPLE Plan Contributions
Name	SIMPLE Deductions
Mangino, R.	$20
Flores, I.	50
Palmetto, C.	40
Waters, R.	60
Kroll, C.	20
Ruppert, C.	40
Scott, W.	50
Wickman, S.	50
Foley, L.	30
Olney, M.	80

http://www.investopedia.com/university/retirementplans/simpleira/?adtest=rira-layout-bttn-bsln

Employee Data

Below lists each employee's assigned Time Card No., Martial Status, and Allowances. This information is necessary when determining the amount of tax to withhold.

Time Card	Employee Name	Martial Status	No. of Allowances
11	Rob. A. Mangino	S	1
12	Inga C. Flores	S	0
13	Carson S. Palmetto	M	2
21	Randy F. Waters	M	3
22	Cathy T. Kroll	S	2
31	Carmen V. Ruppert	M	3
32	William M. Scott	M	4
33	Sarah A. Wickman	S	1
51	Lucas T. Foley	M	5
99	Marshal W. Olney	M	7

Payroll Register

For this task, each employee's federal, state, and local taxes to be withheld will be determined. When determining the federal taxes to be withheld, remember that there are some deductions that are allowed "pre-tax". These deductions reduce the gross earnings upon which the federal tax to be withheld is determined.

Complete the steps outlined below.

Refer to the SIMPLE Plan Contributions and enter each employee's SIMPLE plan deduction.

Determine and record the federal income taxes for each employee.

→ Refer to each employee's marital status and number of allowances
→ Click the link below to view the Wage-Bracket Method tables

Determine and record the state income taxes for each employee using the State of Pennsylvania's rate of 3.07%.

Determine and record the city income taxes for the city of Allentown at the rate is 1.975%.

Total each input column.

Note: Round your final answers to the cent.

Click here to access the Wage-Bracket Method Tables.

OLNEY COMPANY, INC. Employee Payroll Register For Period Ending January 8, 20--
	EARNINGS	DEDUCTIONS									NET PAY
Name	Gross	OASDI	HI	FIT	SIT	SUTA	CIT	SIMPLE	Grp. Ins.	Health Ins.	Ck. No.	Amount
Mangino, R.	$740.00	$45.88	$10.73
Flores, I.	1,058.80	65.65	15.35
Palmetto, C.	685.30	42.49	9.94
Waters, R.	1,045.35	64.81	15.16
Kroll, C.	952.00	59.02	13.80
Ruppert, C.	837.50	51.93	12.14
Scott, W.	780.00	48.36	11.31
Wickman, S.	807.69	50.08	11.71
Foley, L.	1,233.16	76.46	17.88
Olney, M.	1,500.00	93.00	21.75
Totals		$597.68	$139.77								----

Answer 1

Olney Company Inc.
Payroll Register
For Period Ending January 8, 2018
Employee Name	Marital Status	No. of Withholding Allowance	Gross Earnings	Deductions
				(a) FICA		(b) FIT	© SIT	(d) CIT	(e) SIMPLE	Net Pay
				OASDI	HI
Mangino, R.	S	1	$740.00	$45.88	$10.73	$65.00	$22.72	$14.62	$20.00	$561.06
Flores, I.	S	0	$1,058.80	$65.65	$15.35	$127.00	$32.51	$20.91	$50.00	$747.39
Palmetto, C.	M	2	$685.30	$42.49	$9.94	$27.00	$21.04	$13.53	$40.00	$531.30
Waters, R.	M	3	$1,045.35	$64.81	$15.16	$56.00	$32.09	$20.65	$60.00	$796.64
Kroll, C.	S	2	$952.00	$59.02	$13.80	$81.00	$29.23	$18.80	$20.00	$730.14
Ruppert, C.	M	3	$837.50	$51.93	$12.14	$34.00	$25.71	$16.54	$40.00	$657.18
Scott, W.	M	4	$780.00	$48.36	$11.31	$19.00	$23.95	$15.41	$50.00	$611.98
Wickman, S.	S	1	$807.69	$50.08	$11.71	$69.00	$24.80	$15.95	$50.00	$586.15
Foley, L.	M	5	$1,233.16	$76.46	$17.88	$62.00	$37.86	$24.35	$30.00	$984.61
Olney, M.	M	7	$1,500.00	$93.00	$21.75	$69.00	$46.05	$29.63	$80.00	$1,160.58
Totals			$9,639.80	$597.67	$139.78	$609.00	$295.94	$190.39	$440.00	$7,367.03