[The following information applies to the questionsdisplayed below.]
The following summary data for the payroll period ended December27, 2015, are available for Cayman Coating Co.:
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| | |
| Gross pay | $ | 172,000 |
| FICA tax withholdings | | ? |
| Income tax withholdings | | 20,640 |
| Group hospitalization insurance | | 2,540 |
| Employee contributions to pension plan | | ? |
| Total deductions | | 41,650 |
| Net pay | | ? |
|
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Additional information:
- For employees, FICA tax rates for 2015 were 7.65% on the first$118,500 of each employee’s annual earnings. However, no employeeshad accumulated earnings for the year in excess of the $118,500limit.
- For employers, FICA tax rates for 2015 were also 7.65% on thefirst $118,500 of each employee’s annual earnings.
- The federal and state unemployment compensation tax rates are0.6% and 5.4%, respectively. These rates are levied against theemployer for the first $7,000 of each employee’s annual earnings.Only $18,000 of the gross pay amount for the December 27, 2015, payperiod was owed to employees who were still under the annuallimit.
