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Ilia_Sergeevich [38]
3 years ago
6

Jefferson tutoring had the following payroll information on Feb 28:

Business
1 answer:
Norma-Jean [14]3 years ago
6 0

Answer: D. all of the above.

Explanation:

FUTA:

Cumulative earnings were $4,000. FUTA is one the first $7,000 which means that only $3,000 is left to be taxed on account of the cumulative earnings prior to this payroll having been taxed:

= 0.8% * 3,000

= $24

This will be credited to FUTA Payable to recognize that Jefferson owes this liability.

SUTA:

Same goes for SUTA:

= 2% * 3,000

= $60

This will be credited to SUTA Payable to recognize that Jefferson owes this liability.

Payroll tax expense:

= FICA taxes + Medicare + FUTA + SUTA

= ((6.2% + 1.45%) * 4,000) + 24 + 60

= $390

This will be debited to Payroll Tax expense because expenses are debited when they increase.

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