bmx company has one employee. fica social security taxes are 6.2% of the first $137,700 paid to its…

bmx company has one employee. fica social security taxes are 6.2% of the first $137,700 paid to its employee, and fica medicare taxes are 1.45% of gross pay. for bmx, its futa taxes are 0.6% and suta taxes are 5.4% of the first $7,000 paid to its employee.\ngross pay through august 31 gross pay for september\na. $6,200 $1,600\nb. 2,200 2,300\nc. 133,100 9,700\nexercise 11 - 8 (algo) payroll - related journal entries lo p2\nassuming situation (a), prepare the employers september 30 journal entry to record salary expense and its related payroll liabilities for this employee. the employees federal income taxes withheld by the employer are $80 for this pay period.\ncomplete this question by entering your answers in the tabs below.\ntaxes to be withheld from gross pay general journal\nthe employees federal income taxes withheld by the employer are $80 for this pay period the taxes to be withheld from gross pay for this employee.\nnote: round your answers to 2 decimal places.\ntaxes to be withheld from gross pay (employee - paid taxes)\nseptember earnings subject to tax tax rate tax amount\nfederal income tax $80.00

bmx company has one employee. fica social security taxes are 6.2% of the first $137,700 paid to its employee, and fica medicare taxes are 1.45% of gross pay. for bmx, its futa taxes are 0.6% and suta taxes are 5.4% of the first $7,000 paid to its employee.\ngross pay through august 31 gross pay for september\na. $6,200 $1,600\nb. 2,200 2,300\nc. 133,100 9,700\nexercise 11 - 8 (algo) payroll - related journal entries lo p2\nassuming situation (a), prepare the employers september 30 journal entry to record salary expense and its related payroll liabilities for this employee. the employees federal income taxes withheld by the employer are $80 for this pay period.\ncomplete this question by entering your answers in the tabs below.\ntaxes to be withheld from gross pay general journal\nthe employees federal income taxes withheld by the employer are $80 for this pay period the taxes to be withheld from gross pay for this employee.\nnote: round your answers to 2 decimal places.\ntaxes to be withheld from gross pay (employee - paid taxes)\nseptember earnings subject to tax tax rate tax amount\nfederal income tax $80.00

Answer

Explanation:

Step1: Calculate FICA - Social Security tax

The employee's gross pay through August 31 is $6,200 and September gross pay is $1,600. The total gross pay is $6,200 + $1,600= $7,800. Since $7,800 is less than the $137,700 limit for FICA - Social Security, the tax is calculated on the September pay. FICA - Social Security tax = $1,600×6.2% = $1,600×0.062 = $99.20

Step2: Calculate FICA - Medicare tax

FICA - Medicare tax is calculated on the September gross pay. FICA - Medicare tax = $1,600×1.45% = $1,600×0.0145 = $23.20

Step3: Calculate FUTA tax

The total pay to the employee is $6,200 + $1,600 = $7,800 which is more than the $7,000 limit for FUTA and SUTA. But we calculate FUTA on the amount up to $7,000. Since the pay through August 31 is $6,200, the additional amount subject to FUTA in September is $7,000 - $6,200=$800. FUTA tax = $800×0.6% = $800×0.006 = $4.80

Step4: Calculate SUTA tax

Using the same logic as FUTA, the additional amount subject to SUTA in September is $7,000 - $6,200 = $800. SUTA tax = $800×5.4% = $800×0.054 = $43.20

Answer:

Tax Type Tax Amount
FICA - Social Security tax $99.20
FICA - Medicare tax $23.20
FUTA tax $4.80
SUTA tax $43.20