Karen Cooper,the Founder of SmartIT Staffing,realized That Effectively Managing Payroll

question 104

Multiple Choice

Karen Cooper,the founder of SmartIT Staffing,realized that effectively managing payroll was crucial to the success of her business.If an employee of the company earns $50,500 per year,SmartIT Staffing's total FICA payroll tax for this employee is:

• A)$3,863.25.
• B)$3,131.00.
• C)$732.25.
• D)$3,535.
• E)Zero because the employee has not earned more that the FICA earnings limitation.

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Definitions:

Par Value

The face or nominal value of a bond, stock share, or coupon as specified on a certificate or instrument.

Stock Dividend

A payment made by a corporation to its shareholders in the form of additional shares, rather than cash, reflecting the company's intention to reinvest profits.

Retained Earnings

Profits that a company keeps or reinvests for expansion or debt payment, rather than distributing to shareholders as dividends.

Stock Split

A corporate action to increase the number of outstanding shares by dividing each share, which typically lowers the stock price but does not affect the company's market value.