Contemporary Mathematics for Business and Consumers, Third Edition

Robert A. Brechner
Copyright © 2003 Thomson/South-Western

Level 2
Chapter 9 - Assessment Test - Exercise 20

Striker Exporting has three warehouse employees: John Abner earns $422 per week, Anne Clark
earns $510 per week, and Todd Corbin earns $695 per week. The company's SUTA tax rate is 5.4%,
and the FUTA rate is 6.2% minus the SUTA. As usual, these taxes are paid on the
first $7,000 of each employee's earnings.

a. How much SUTA and FUTA tax does the company owe on these employees for the
first quarter of the year?

Wage limit for FUTA and SUTA taxes = $7,000.00

FUTA rate = 6.2%

SUTA rate = 5.4% - FUTA =

Gross per Gross for Wages subject to FUTA and SUTA

week first quarter (not to exceed wage limit)

Abner $422.00

Clark $510.00

Corbin $695.00

Total =

SUTA tax, first quarter =

FUTA tax, first quarter =

b. How much SUTA and FUTA tax does Striker owe for the second quarter of the year?

Amount under wage limit

subject to FUTA and SUTA

Abner

Clark

Corbin

Total =

SUTA tax, first quarter =

FUTA tax, second quarter =