Question

Stys Company's payroll for the year is $1,210,930. Of this amount, $510,710 is for wages paid in excess of $7,000 to each individual employee. The SUTA tax rate for the company is 3.2% on the first $7,000 of each employee's earnings.

Answer 1

Answer:

A. $4,201.32

B. $22,407.04

Explanation:

a. Calculation for The amount of FUTA tax for the year

FUTA tax= ($1,210,930-$510,710) *0.006

FUTA tax = $700,220 * 0.006

FUTA tax= $4,201.32

Therefore The amount of FUTA tax for the year is $4,201.32

b. Calculation for The amount of SUTA tax for the year

SUTA tax=($1,210,930-$510,710) *0.032

SUTA tax = $700,220 * 0.032

SUTA tax= $22,407.04

Therefore The amount of SUTA tax for the year is $22,407.04