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The following totals for the month of April were taken from the payroll register of Magnum...

The following totals for the month of April were taken from the payroll register of Magnum Company.: salaries $12,000, Federal $2500, FICA Rate 7.5%, FUTA .8%, SUTA 5.4%. Net Pay would be. Please include all steps. Thanks.

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Expert Solution

Answer: $8,600

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Calculation of Net pay
Gross pay                      $12,000
Payroll withholdings / deductions:
        Federal Income tax withholding $2,500
         FICA tax                                             [$12,000 x 7.5%] $900
Total payroll withholdings / deductions      [$2,500 + $900] $3,400
Net pay                                                       [Gross pay - Total payroll deductions = $12,000 - $3,400] $8,600
Note: An employer does not withhold any amount from the employees salary towards the unemployment taxes.(FUTA and SUTA)

ekkarill92 answered 2 years ago
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