An Employee Earned $100,000 Working for an Employer in the Current

question 217

Multiple Choice

An employee earned $100,000 working for an employer in the current year.The current rate for FICA Social Security is 6.2% payable on earnings up to $128,400 maximum per year and the rate for FICA Medicare 1.45% of all earnings.The employer's total FICA payroll tax for this employee is:

• A)$7,650.
• B)$9,830.
• C)$879.
• D)$8,950.
• E)$0,since the FICA tax is only deducted from an employee's pay.

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Definitions:

Units Sold

The total quantity of products or goods sold by a company during a specific period.

Relevant Range

The scope of activity levels within which the assumptions about fixed and variable costs in cost-volume-profit analysis remain valid.

Contribution Margin

The amount remaining from sales revenue after variable expenses have been deducted, indicating how much contributes to covering fixed costs and profit.

Fixed Costs

Expenses that do not vary with the level of production or sales, such as rent, salaries, and insurance premiums.