An Employee Earned $62,500 During the Year Working for an Employer

question 104

Multiple Choice

An employee earned $62,500 during the year working for an employer. The FICA tax rate for Social Security is 6.2% and the FICA tax rate for Medicare is 1.45%. The current FUTA tax rate is 0.8%, and the SUTA tax rate is 5.4%. Both unemployment taxes are applied to the first $7,000 of an employee's pay. What is the amount of total unemployment taxes the employee must pay?

• A) $101.50
• B) $56.00
• C) $378.00
• D) $434.00
• E) $0.00

Understand strategies for reducing income tax liability for small businesses.

Comprehend the priorities and loyalties of corporations in the U.S.

Identify the impact of recessions on different types of investments.

Recognize the components of investment in the context of calculating GDP.

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Definitions:

Production Department Rate

The Production Department Rate is a measure of efficiency in a production department, defined as the cost to produce one unit of product.

Overhead Application

The process of assigning manufacturing overhead costs to specific products or job orders based on a predetermined rate or method.

Cost Driver

A factor that causes a change in the cost of an activity or product.

Cost Allocation Process

The procedure of identifying, aggregating, and assigning costs to cost objects, such as products, services, or departments.