Problem 10D: Payroll

Problem 10d: Payroll

1.Anita Bumann's business, Bumann Consulting Incorporated, has 5 employees who are paid one week after the week they work. As of October 6, each employee's gross earnings for the year were as follows.

Diorio / $40,000
Gray / $5,600
Higgins / $96,300
Hwalek / $41,500
Olin / $103,300

For this year, the OASDI FICA tax rate is 6.2% of the first $97,500 of each employee’s gross pay. The Medicare FICA tax rate is 1.45% of each employee’s gross pay. Federal unemployment tax is .8% of the first $7,000 per employee. State unemployment tax is 4% of the first $7,000 per employee. Each employee has $6 withheld weekly for union dues.

Calculate the net pay for Bumann Consulting Incorporated’s employee Diorio for the week ended October 13. Diorio earns a salary of $1,000 per week. In addition to FICA taxes and union dues, the following were withheld from Diorio’s weekly earnings: $200 for federal income taxes and $50 for state income taxes.

A) / $1,000.00
B) / $667.50
C) / $619.50
D) / $1,332.50
E) / $729.50

2.Anita Bumann's business, Bumann Consulting Incorporated, has 5 employees who are paid one week after the week they work. As of October 6, each employee's gross earnings for the year were as follows.

Diorio / $40,000
Gray / $5,600
Higgins / $96,300
Hwalek / $41,500
Olin / $103,300

Calculate the net pay for Bumann Consulting Incorporated’s employee Gray for the week ended October 13. Gray worked 30 hours during the week at a wage rate of $20 per hour. In addition to FICA taxes and union dues, the following were withheld from Gray’s weekly earnings: $110 for federal income taxes and $30 for state income taxes.

A) / $791.90
B) / $445.30
C) / $600.00
D) / $408.10
E) / $379.30

3.Anita Bumann's business, Bumann Consulting Incorporated, has 5 employees who are paid one week after the week they work. As of October 6, each employee's gross earnings for the year were as follows.

Diorio / $40,000
Gray / $5,600
Higgins / $96,300
Hwalek / $41,500
Olin / $103,300

Calculate the net pay for Bumann Consulting Incorporated’s employee Higgins for the week ended October 13. Higgins earns a salary of $2,400 per week. In addition to FICA taxes and union dues, the following were withheld from Higgins’ weekly earnings: $380 for federal income taxes and $90 for state income taxes.

A) / $1,814.80
B) / $1,699.60
C) / $2,985.20
D) / $1,740.40
E) / $2,400.00

4.Anita Bumann's business, Bumann Consulting Incorporated, has 5 employees who are paid one week after the week they work. As of October 6, each employee's gross earnings for the year were as follows.

Diorio / $40,000
Gray / $5,600
Higgins / $96,300
Hwalek / $41,500
Olin / $103,300

Calculate the net pay for Bumann Consulting Incorporated’s employee Hwalek for the week ended October 13. Hwalek worked 35 hours during the week at a wage rate of $32 per hour. In addition to FICA taxes and union dues, the following were withheld from Hwalek’s weekly earnings: $210 for federal income taxes and $50 for state income taxes.

A) / $714.56
B) / $1,471.68
C) / $837.76
D) / $1,120.00
E) / $768.32

5.Anita Bumann's business, Bumann Consulting Incorporated, has 5 employees who are paid one week after the week they work. As of October 6, each employee's gross earnings for the year were as follows.

Diorio / $40,000
Gray / $5,600
Higgins / $96,300
Hwalek / $41,500
Olin / $103,300

Calculate the net pay for Bumann Consulting Incorporated’s employee Olin for the week ended October 13. Olin earns a salary of $2,600 per week. In addition to FICA taxes and union dues, the following were withheld from Olin’s weekly earnings: $530 for federal income taxes and $110 for state income taxes.

A) / $1,755.10
B) / $2,600.00
C) / $1,916.30
D) / $1,791.50
E) / $3,283.70

6.The Bumann Consulting Incorporated’s payroll register for the week ended October 6 was as follows. Employees were paid on October 13.

Employee / Gross / FIT / SIT / OASDI / Medicare / Union / Net Pay
Diorio / $1,000.00 / $196.00 / $47.00 / $62.00 / $14.50 / $6.00 / $674.50
Gray / $560.00 / $101.00 / $28.00 / $34.10 / $8.12 / $6.00 / $382.78
Higgins / $2,400.00 / $384.00 / $93.00 / $148.80 / $34.80 / $6.00 / $1,733.40
Hwalek / $960.00 / $180.00 / $48.00 / $59.52 / $13.92 / $6.00 / $652.56
Olin / $2,600.00 / $533.00 / $112.00 / $0.00 / $37.70 / $6.00 / $1,911.30
Totals / $7,520.00 / $1,394.00 / $328.00 / $304.42 / $109.04 / $30.00 / $5,354.54

Determine the Bumann Consulting Incorporated’s salaries and wages expense for the week ended October 6.

A) / $6,126.00
B) / $2,165.46
C) / $5,354.54
D) / $7,520.00
E) / $5,384.54

7.The Bumann Consulting Incorporated’s payroll register for the week ended October 6 was as follows. Employees were paid on October 13.

On October 13, when the Bumann Consulting Incorporated’s employees are paid, how much cash will they receive?

A) / $6,126.00
B) / $2,165.46
C) / $5,354.54
D) / $7,520.00
E) / $5,384.54

8.The Bumann Consulting Incorporated’s payroll register for the week ended October 6 was as follows. Employees were paid on October 13. All amounts withheld from employees will be paid in November.

By addition and subtraction, show the effects of the October 6 payroll on the Bumann Consulting Incorporated’s resources and sources of resources.

Resources / Sources of Borrowed Resources / Sources of Owner Invested Resources / Sources of Management Generated Resources
Assets / Liabilities / Stockholders’ Equity
A) / - $7,520.00 / - $7,520.00
B) / + $7,520.00 / + $7,520.00
C) / - $5,354.54 / - $5,354.54
D) / + $5,354.54 / - $5,354.54
E) / + $7,520.00 / - $7,520.00

9.The Bumann Consulting Incorporated’s payroll register for the week ended October 6 was as follows. Employees were paid on October 13. All amounts withheld from employees will be paid in November.

Prepare the journal entry to record the payroll for the week ended October 6.

Description / Debits / Credits
A) / Salaries and Wages Expense / $5,354.54
Salaries and Wages Payable / $5,354.24
B) / Salaries and Wages Expense / $7,520.00
Employees’ Federal Income Taxes Withheld / $1,394.00
Employees’ State Income Taxes Withheld / $328.00
FICA Taxes Payable / $413.46
Union Dues Payable / $30.00
Salaries and Wages Payable / $5,354.54
C) / Salaries and Wages Expense / $5,354.54
Cash / $5,354.24
D) / No entry required
E) / Salaries and Wages Expense / $7,520.00
Employees’ Federal Income Taxes Withheld / $1,394.00
Employees’ State Income Taxes Withheld / $328.00
FICA Taxes Payable / $413.46
Union Dues Payable / $30.00
Cash / $5,354.24

10.Bumann Consulting Incorporated has 5 employees who are paid one week after the week they work. The following information is available.

Employee / Earnings as of
September 29 / Earnngs for Week
Ended October 6
Diorio / $39,000 / $1,000
Gray / $5,040 / $560
Higgins / $93,900 / $2,400
Hwalek / $40,540 / $960
Olin / $100,700 / $2,600
Totals / $279,180 / $7,520

Calculate the company’s payroll taxes expense for OASDI FICA taxes for the week ended October 6.

A) / $305.04
B) / $466.24
C) / $575.28
D) / $17,309.16
E) / $376.38

11.Bumann Consulting Incorporated has 5 employees who are paid one week after the week they work. The following information is available.

Calculate the company’s payroll taxes expense for Medicare FICA taxes for the week ended October 6.

A) / $575.28
B) / $71.34
C) / $376.38
D) / $4,048.11
E) / $109.04

12.Bumann Consulting Incorporated has 5 employees who are paid one week after the week they work. The following information is available.

Calculate the company’s payroll taxes expense for federal unemployment taxes for the week ended October 6.

A) / $4.48
B) / $60.16
C) / $44.80
D) / $360.96
E) / $26.88

13.Bumann Consulting Incorporated has 5 employees who are paid one week after the week they work. The following information is available.

Calculate the company’s payroll taxes expense for state unemployment taxes for the week ended October 6.

A) / $300.80
B) / $360.96
C) / $22.40
D) / $26.88
E) / $1,400.00