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Snezhnost [94]
3 years ago
9

Youngston Company (a Massachusetts employer) wants to give a holiday bonus check of $750 to each employee. Since it wants the ch

eck amount to be $750, it will need to gross-up the amount of the bonus. Calculate the withholding taxes and the gross amount of the bonus to be made to Genna Fredrich if her earnings for the year are $55,920. Besides being subject to social security taxes and federal income tax (supplemental rate), a 5.05% Massachusetts income tax must be withheld on supplemental payments.
Business
1 answer:
stepan [7]3 years ago
7 0

Answer:

Gross bonus=$1,148.54

FIT=252.68

OASDI=71.21

HI =16.65

MASS. TAX=58.00

Explanation:

Calculation for the withholding taxes and the gross amount of the bonus

Calculation for gross amount of the bonus

Gross amount of the bonus= [$750/ (1- 0.22 - 0.062 - 0.0145 - 0.0505] - 0.01

Gross amount of the bonus= [$750/ (0.78 - 0.062 - 0.0145 - 0.0505] - 0.01

Gross amount of the bonus= [$750/ 0.653] - 0.01

Gross amount of the bonus=1,148.545-0.01

Gross amount of the bonus=$ 1,148.54

Therefore the Gross amount of the bonus will be $ 1,148.54

Calculation for the withholding taxes

FIT =1148.54 * 22%

FIT=252.68

OASDI= 1148.54 * 6.2%

OASDI=71.21

HI=1148.54 * 1.45%

HI =16.65

MASS. TAX =1148.54 * 5.05%

MASS. TAX =58.00

NET 750.00

[$1,148.54-(252.68+71.21+16.65+58.00)]

Therefore the withholding taxes are:

FIT=252.68

OASDI=71.21

HI =16.65

MASS. TAX = =58.00

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Answer: False

Explanation:

Classification shifting is a method used whereby the core earnings are manipulated by misclassifying the items in the income statement.

One way that managers make use of classification shifting is by reporting the operating expenses for the business as nonoperating expenses. This is usually done in order to inflate the operating income.

The statement in the question is false as classification shifting by managers doesn't lead to under-reporting of total expenses and over-statement of bottom-line net income rather it lead to over reporting.

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Answer:

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If a stock is purchased for $100 per share and held one year, during which time a quarterly dividend of $1.5 is paid, each quart
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Answer:

Total yield or rate of return is 0.36 or 36%

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Total dividends for the year = 1.5 * 4 = $6

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Total Yield = (6 + 30) / 100

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