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Homework answers / question archive / Brief Exercise 8-5 Calculate FICA taxes (L08-3)  Mike Samson is a college football coach making a base salary of $638,400 a year ($53,200 per month)

Brief Exercise 8-5 Calculate FICA taxes (L08-3)  Mike Samson is a college football coach making a base salary of $638,400 a year ($53,200 per month)

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Brief Exercise 8-5 Calculate FICA taxes (L08-3) 
Mike Samson is a college football coach making a base salary of $638,400 a year ($53,200 per month). Employers are required to withhold a 6.2% Social Security tax up to a maximum base amount and a 1.45% Medicare tax with no maximum. Assuming the FICA base amount is $128,400. 
1. Compute how much will be withheld during the year for Coach Samson's Social Security and Medicare. (Round your final answers to 2 decimal places.) 
Social security Medicare I° $ 1.451 
2. What matching amount will the employer need to contribute? (Round your final answer to 2 decimal places.) 
$ 17,217.60 
 

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1) Computation of Amount to be Withheld during the Year for Coach Samson's Social Security and Medicare:

Social Security Tax Withheld ($128,400*6.2%) = $7,960.80

Medicare Tax Withheld ($638,400*1.45%) = $9,256.80

Total Amount to be Withheld ($7,960.80+$9,256.80) = $17,217.60

 

2) Computation of Employer's Contribution:

The employer is liable to match the amount withheld from the employee's salary. Therefore, the employer will also contribute the same amount as withheld from M's salary.

So, Employer's Contribution = $17,217.60

 

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