ACCOUNTING

se the percentage method to compute the federal income taxes to withhold from the wages or salaries of each employee.

 

4–2A.

 


Employee
No.

Employee Name

Marital
Status
No. of
Withholding
Allowances

Gross Wage
or Salary
Amount
to Be
Withheld
1 Amoroso, A. M 4   $1,610 weekly  
2 Finley, R. S 0         825 biweekly  
3 Gluck, E. S 5     9,630 quarterly  
4 Quinn, S. M 8         925 semimonthly  
5 Treave, Y. M 3     2,875 monthly  

 

Eaton Enterprises uses the wage-bracket method to determine federal income tax withholding on its employees.  Find the amount to withhold from the wages paid each employee.

 

4–4A.

 

Employee

Marital
Status

No. of
Withholding
Allowances

Payroll Period
W = Weekly
S = Semimonthly
M = Monthly
D = Daily

Wage

Amount to
Be Withheld

Hal Bower M 1 W $1,350  
Ruth Cramden S 1 W        590  
Gil Jones S 3 W        675  
Teresa Kern M 6 M    4,090  
Ruby Long M 2 M    2,730  
Katie Luis M 8 S        955  
Susan Martin S 1 D          96  
*Jim Singer S 4 S    2,610  
Martin Torres M 4 M    3,215  

 

 

 

*Must use percentage method (Jim Singer ONLY)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Damerly Company wants to give a holiday bonus check of $250 to each employee.  Since it wants the check amount to be $250, it will need to gross up the amount of the bonus.  Calculate the withholding  taxes and gross amount of the bonus to be made to John Rolen if his cumulative earnings for the year are $46,910.  Besides, being subject to social security taxes and federal income tax (supplemental rate), a 7% California income tax must be withheld on supplemental payments.

 

4–6A.

 

(a)                                                                           $250

 

1 – 0.25 (supplemental federal rate) – 0.062 (OASDI) – 0.0145 (HI) – 0.07 (California tax) = ___________

 

 

 

(b)  $250/(1 – 0.3965) = __________

 

 

 

(c)  Gross bonus amount __________

 

Federal income tax withheld __________

 

OASDI tax withheld ____________

 

HI tax withheld ____________

 

California income tax withheld ___________

 

Take-home bonus check __________

 

 

 

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