# chapter 5 solutions

Pages: 4 (877 words) Published: November 2, 2014

CHAPTER 5
Solutions—Series A Problems
5–1A.(a)Net FUTA tax \$123,400 × 0.006=\$740.40
(b)Net SUTA tax\$123,400 × 0.048=5,923.20
(c)Total unemployment taxes\$6,663.60
5–2A.Earnings subject to FUTA and SUTA:
\$737,910 – \$472,120 = \$265,790
(a)Net FUTA tax\$265,790 × 0.006=\$1,594.74
(b)Net SUTA tax\$265,790 × 0.029=7,707.91
(c)Total unemployment taxes\$9,302.65
5–3A.(a)Net FUTA tax\$67,900 × 0.006=\$407.40
(b)Net SUTA tax\$83,900 × 0.037=\$3,104.30
5–4A.(a)SUTA taxes paid to Massachusetts\$18,000 × 0.04=\$720.00 (b)SUTA taxes paid to New Hampshire\$24,000 × 0.0265=\$636.00 (c)SUTA taxes paid to Maine\$79,000 × 0.029=\$2,291.00
(d)FUTA taxes paid\$103,500 × 0.006=\$621.00
5–5A.(a)Yes. Donner Company meets the test of having paid wages totaling more than \$1,500 during any calendar quarter of the current year. (b)Taxable wages\$23,400 + \$64,700=\$88,100.00
Net FUTA tax\$88,100 × 0.006=\$528.60
5–6A.(a)FUTA taxable wages:
Total wages\$177,610
Less: Director’s salary(900)
Less: Nontaxable portion of president’s and vice
president’s salaries [(\$20,000 – \$7,000) + (\$15,000 – \$7,000)](21,000) Less: Pretax cafeteria plan contributions (2,000)
Taxable wages\$153,710
Net FUTA tax: \$153,710 × 0.006\$922.26
(b)SUTA taxable wages:
Total wages\$177,610
Less: Director’s salary(900)
Less: Nontaxable portion of president’s and vice
president’s salaries [(\$20,000 – \$7,000) + (\$15,000
– \$7,000)](21,000)
Less: Pretax cafeteria plan contributions (2,000)
Taxable wages\$153,710
SUTA tax: \$153,710 × 0.035\$5,379.85
5–7A.(a)\$2,800 × 0.032 = \$89.60
(b)(\$9,000 – \$ 2,800) × 0.038 = \$235.60
(c)(\$7,000 × 0.006) + [(\$7,000 – \$2,800) × 0.006] = \$67.20 5–8A.(a)FUTA tax\$7,000 × 0.006=\$42.00
SUTA tax\$22,000 × 0.046= 1,012.00
Total= \$1,054.00
(b)FUTA tax\$7,000 × 0.006=\$42.00
SUTA tax\$8,000 × 0.051=408.00
Total=\$ 450.00
5–9A. (a)Gross payroll\$314,800
Less: Payroll to partners (nontaxable)(160,000)
Less: Salaries beyond \$7,000 limit(114,800)
Taxable payroll\$40,000
FUTA tax...