Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. a new employee makes $175,000 and has been hired o

A new employee makes $175,000 and has been hired on Jan 1, 2020. She elects...

50.1K

Verified Solution

Question

Accounting

A new employee makes $175,000 and has been hired on Jan 1, 2020.

She elects to obtain the company's medical insurance offering and has her share of the premium be deducted from her pay. The total medical insurance premium is $1,500 per month, of which 1/2 is paid by the company. She also contributes 12% of her salary to her 401(k), and as a retirement benefit the company will match up to $8,750. Her employer also provides a defined contribution pension plan which contributes up to $17,500. She then deducts $200 per month from her check to charity.

Important information:

FIT: Assume a rate of 20% of taxable earnings

FICA: Wage base reported by IRS for 2020 is $137,700 with 7.65% Medicare tax rate and 6.2% social security tax rate.

Unemployment Taxes: Use taxable wage base of $9,000 for calculating the SUTA tax with an assumed rate of 5.4%. Use the federal taxable wage base of $7,000 for calculating the FUTA tax with an assumed rate of 0.8%.

Required:

A) Prepare a schedule showing Anitas projected 2020 gross pay, taxable earnings, and net pay. (Make sure you list each deduction)

B) Prepare a schedule showing the total projected 2020 cost to the company for hiring Anita. (Each cost should be displayed in the schedule)

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students