Oakton Community College
Accounting 170 – Payroll Accounting
Robert Bruebach
Homework - Week #1
SOLUTIONS
Problem #1
Below is a portion of the weekly payroll register for Tagert Company. Compute the FICA taxes
for each employee and the employer's share of FICA taxes.
Employee
Wages
Employee FICA Taxes
OASDI
HI
John
$327.68
$20.32
$4.75
Susan
$438.00
$27.16
$6.35
Kim
$365.33
$22.65
$5.30
Jim
$401.25
$24.88
$5.82
Henry
$675.00
$41.85
$9.79
Carl
$765.50
$47.46
$11.10
$499.00
$3,471.76
$30.94
$215.26
$7.24
$50.35
Employer's (ER) OASDI:
$3,471.76
Total Taxable Wages
$215.25
ER's OASDI Tax
Employer's (ER) HI Tax:
$3,471.76
Total Taxable Wages
$50.34
ER's HI Tax
Melody
Page 1
Oakton Community College
Accounting 170 – Payroll Accounting
Robert Bruebach
Homework - Week #1
SOLUTIONS
Problem #2
During this year, an employee of the Billups Company will be paid a semimonthly salary of $5,200.
Compute the FICA taxes for each of the following paychecks:
FICA Taxes
OASDI
HI
8th Paycheck of the Year:
$322.40 *
$75.40
23rd Paycheck of the Year:
$254.20 **
$75.40
24th Paycheck of the Year:
$0.00 ***
$75.40
* Cumulative earnings as of the 7th paycheck are $36,400. Therefore, the 8th paycheck for $5,200 will not have the
employee exceed the $118,500 maximum, so the entire amount of the 8th paycheck of $5,200 is subject to OASDI
tax of 6.2%.
** Cumulative earnings as of the 22nd paycheck are $114,400. Therefore, the 23rd paycheck for $5,200 will have the
employee exceed the $118,500 maximum, so only a portion ($4,100) of the 23rd paycheck is subject to OASDI tax of
6.2%.
** Since the employee reached the $118,500 maximum with the 23rd paycheck, none of the $5,200 paycheck is
subject to OASDI tax for the 24th paycheck of the year.
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Oakton Community College
Accounting 170 – Payroll Accounting
Robert Bruebach
Homework - Week #1
SOLUTIONS
Problem #3
Below is a list of employees and their annual salaries. The employees are paid semimonthly on
the 15th and the last day of the month. Compute the FICA taxes to be withheld from each
employee’s pay on November 15th and December 31st.
November 15th
Name and Title
Tate, Jack, President
Green, Sue, VP Finance
Jones, Al, Sales
David, James, Manufacturing
Wong, Pam, Personnel
Molt, Mary, Secretary
Annual
Salary
$138,000
118,800
69,600
54,000
51,600
49,200
OASDI
Taxable
Earnings
$3,500.00*
4,950.00
2,900.00
2,250.00
2,150.00
2,050.00
OASDI
Tax
$217.00
306.90
179.80
139.50
133.30
127.10
HI
Taxable
Earnings
$5,750.00
4,950.00
2,900.00
2,250.00
2,150.00
2,050.00
HI
Tax
$83.38
71.78
42.05
32.63
31.18
29.73
*Cumulative earnings as of October 31st —> $115,000. So, only $3,500 of $5,750 on Nov. 15th subject to FICAOASDI.
December 31st
Name and Title
Tate, Jack, President
Green, Sue, VP Finance
Jones, Al, Sales
David, James, Manufacturing
Wong, Pam, Personnel
Molt, Mary, Secretary
Annual
Salary
$138,000
118,800
69,600
54,000
51,600
49,200
OASDI
Taxable
Earnings
$0.00
4,650.00**
2,900.00
2,250.00
2,150.00
2,050.00
OASDI
Tax
$ 0.00
288.30
179.80
139.50
133.30
127.10
HI
Taxable
Earnings
$5,750.00
4,950.00
2,900.00
2,250.00
2,150.00
2,050.00
HI
Tax
$83.38
71.78
42.05
32.63
31.18
29.73
**Cumulative earnings as of December 15th —> $113,850. So, only $4,650 of $4,950 paid on Dec. 31st is subject
to FICA-OASDI.
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Oakton Community College
Accounting 170 – Payroll Accounting
Robert Bruebach
Homework - Week #1
SOLUTIONS
Problem #4
Flextron Corp. pays its salaried employees monthly on the last day of each month. The annual
salary for each employee is shown below. Compute the following for the payroll of December
31st.
Employee
Maggert, June
Leonard, Kathy
Ferris, Demi
Stewart, Sam
Wilton, Harriet
Hopkins, Louis
Singh, Sonja
Keith, Karen
Pierce, Ted
Daven, Maria
Totals
Annual
Salary
$ 22,150
18,900
24,000
118,944
20,900
19,500
18,540
56,900
17,850
51,200
OASDI
Taxable
Wages
$ 1,845.83
1,575.00
2,000.00
9,468.00*
1,741.67
1,625.00
1,545.00
4,741.67
1,487.50
4,266.67
$30,296.34
OASDI
Tax
$ 114.44
97.65
124.00
587.02
107.98
100.75
95.79
293.98
92.23
264.53
$1,878.37
HI
Taxable
Wages
$ 1,845.83
1,575.00
2,000.00
9,912.00
1,741.67
1,625.00
1,545.00
4,741.67
1,487.50
4,266.67
$30,740.34
HI
Tax
$ 26.76
22.84
29.00
143.72
25.25
23.56
22.40
68.75
21.57
61.87
$445.72
Employer’s OASDI Tax: ($30,296.34 × 0.062) = $1,878.37
Employer’s HI Tax: ($30,740.34 × 0.0145) = $445.73
* Cumulative earnings as of the 11th (Nov. 30th) paycheck are $109,032. Therefore, the 12th paycheck for $9,912 will
have the employee exceed the $118,500 maximum, so only a portion ($9,468) of the 12th paycheck is subject to
OASDI tax of 6.2%.
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Oakton Community College
Accounting 170 – Payroll Accounting
Robert Bruebach
Homework - Week #1
SOLUTIONS
Question #1
The Self-Employed tax rate for FICA-OASDI is
12.4
%. (12.4% for 2013)
Question #2
What are the deposit due dates for a company classified as a Semi-Weekly Depositor?


If Payday is Wednesday, Thursday, or Friday, then Deposit Due by the Following Wednesday.
If Payday is Sat., Sun., Mon., or Tues., then Deposit Due by the Following Friday.
Question #3
What is Form 941?
A quarterly report of total FICA taxes (employee and employer portions) and withheld federal
income taxes. The form is due by the end of the month following the quarter.
Question #4
FICA defines all of the following as employees except:
a. vice presidents.
b. partners in a partnership.
c. superintendents.
d. full-time life insurance salespersons.
e. payroll managers.
Question #5
To be designated a semiweekly depositor, how much in employment taxes would an employer
have reported for the four quarters in the lookback period?
a. More than $50,000.
b. More than $100,000.
c. Less than $50,000.
d. More than $2,500.
e. None of the above
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