Rate of growth of wages subject to Social Security taxes

Related BrainMass Solutions

• Social Security Taxes

  This solution discusses the real rate of growth of wages subject to social security taxes.

• Journal entries to record salaries and wages plus payroll tax expense

  Salaries $ 452,000 Federal income taxes to be withheld 90,400 Federal unemployment tax rate 0.80% State unemployment tax rate (after FUTA deduction) 5.40% Social Security (FICA) tax rate 7.65% Required: 1.

• Notes Payable, Wages Payable and Journal Entries for State Mill Company

  , $ 2,690; medical insurance deductions, $6,400; and wages subject to unemployment taxes, $114,480.

• Journalizing Payroll Taxes

  For 2011, the employer's social security tax rate is 6.2 percent and the employer's Medicare tax rate is 1.45 percent for a total of 7.65 percent.

• Accruals and Deferrals

  Total deductions..............$8725 Net Pay..........................$16,275 All employee wages are subject to FUT and SUT.

• Numerous Payroll-Related Concepts

  False: The cap is on wages subject to social security tax, not medicare tax. 8. True: this is a close one.

• Computing payroll expenses and journal entry

  This means that the FICA - Social Security tax is to be calculated as 6.2% of all wages earned till they reach 87,000.

• Classifying Liabilities and Preparing Payroll Entries

  . $6,400 $800 Tax Rate Applied To FICA - Social Security 6.20% First $87,000 FICA - Medicare 1.45% All Gross Pay FUTA 0.80% First $7,000 SUTA 2.90% First $7,000

• Payroll tax expense

  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.