David,an Employee of Cecil,Inc

question 6

True/False

David,an employee of Cecil,Inc. ,has gross salary for March of $5,900.The entire amount is under the OASDI limit of $117,000,and thus subject to FICA.He is also subject to federal income tax at a rate of 30%.His year-to-date pay has already exceeded the $7,000 cap for FUTA and SUTA.The journal entry to record the employer's payroll tax expense includes a credit to FICA-OASDI Taxes Payable for $365.80.(Assume a FICA-OASDI Tax of 6.2% and FICA-Medicare Tax of 1.45%. )

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Definitions:

Board of Directors

A group of elected or appointed members who jointly oversee the activities of a company or organization.

Efficient Market Hypothesis

The theory that all existing information is already reflected in securities prices, thus making it impossible to consistently achieve higher returns.

Dissemination

The process of spreading information, knowledge, or ideas to a large number of people.

Executive Stock Option

A privilege, sold by one party to another, that gives the buyer the right, but not the obligation, to buy (call) or sell (put) a stock at an agreed-upon price within a certain period or on a specific date.