Art Panache, the Sole Employee of Panache Sales, Has Gross

question 153

True/False

Art Panache, the sole employee of Panache Sales, has gross salary for March of $5,000. The entire amount is under the OASDI limit of $110,100, and thus subject to FICA. He is also subject to federal income tax at a rate of 20%. His year-to-date pay has already exceeded the $7,000 cap for FUTA and SUTA. The journal entry in the payroll cycle to record employer's payroll tax expense includes a credit to FICA-Medicare Taxes Payable for $145. (Assume a FICA-OASDI Tax of 6.2% and FICA-Medicare Tax of 1.45%.)

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Definitions:

Behavioral Consistency

The tendency for people to exhibit the same behaviors across different situations and over time.

Aggregate

A total or sum made from individual parts.

Blank Slate

The idea that individuals are born without built-in mental content and that all knowledge comes from experience or perception.

John Locke

A 17th-century English philosopher and political theorist, known for his work on liberalism and the theory of knowledge.