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Payroll tax expense

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A company's employees had the following earnings records at the close of the current payroll period:
The company's payroll taxes expense on each employee's earnings includes: FICA Social Security taxes of 6.2% on the first $84,900 plus 1.45% FICA Medicare on all wages; 0.8% federal unemployment taxes on the first $7,000; and 2.5% state unemployment taxes on the first $7,000. Compute the employer's total payroll taxes expense for the current pay period.

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** Please see the attached file for a Word formatted copy of the solution response **

We first calculate the earnings subject to tax
Employees FICA SUTA & FUTA
D. Adams ...

Solution Summary

This solution explains how to calculate the payroll tax expense for the employer in the given accounting problem.