Midwest Shipping Pays Employees at the End of Each Month

question 12

Essay

Midwest Shipping pays employees at the end of each month.Payroll information is listed below for January,the first month of the fiscal year.Assume that none of the employees exceeds the Federal unemployment tax maximum salary of $7,000 in January.
$$\begin{array} { l r } \text { Salaries } & \$ 800,000 \\\text { Federal and state income taxes withheld } & 160,000 \\\text { Federal unemployment tax rate } & 0.80 \% \\\text { State unemployment tax rate (after FUTA deduction) } & 3.00 \% \\\text { Social Security (FICA) tax rate } & 7.65 \%\end{array}$$
Record salaries expense and payroll tax expense for the January pay period.

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Definitions:

Federal Government

The national government of a federated state, which is responsible for national affairs.

Economic Roles

The functions and responsibilities different entities (like individuals, firms, and governments) play in the economy.

Taxable Income

The portion of an individual or company's income used to determine how much tax is owed to the government in a given tax year.

Federal Income Tax

A tax levied by the United States federal government on the annual earnings of individuals, corporations, trusts, and other legal entities. Tax rates vary based on income levels and types of filers.