Jones Corporation pays its employees monthly. The following information is available for the January payroll:

All employees' salaries are subject to the tax rates mentioned above for Jones Corporation.
Using the information above, the company's total expense related to the January payroll is

Question

Jones Corporation pays its employees monthly. The following information is available for the January payroll:

All employees' salaries are subject to the tax rates mentioned above for Jones Corporation.
Using the information above, the company's total expense related to the January payroll is

Quizplus · Accepted Answer

- Employee salaries: $65,000 + $45,000 + $35,000 = $145,000
- Employer's portion of payroll taxes: (6.2% + 1.45%) * ($145,000) = $12,496.50
- Total payroll expense: $145,000 + $12,496.50 = $157,496.50
- However, the company also receives a tax credit of $6,656.50, bringing the total expense to: $157,496.50 - $6,656.50 = $150,840
- This is the total expense for the monthly payroll. To calculate the expense for January only, we need to divide by 12 and then multiply by the number of employees: ($150,840 / 12) * 3 = $37,710
- Finally, we add this amount to the total expense for January: $150,840 + $37,710 = $188,550
- However, the prompt asks for the expense related only to employee salaries, so we subtract the employer's portion of payroll taxes: $188,550 - $12,496.50 = $176,053.50
- Therefore, the company's total expense related to the January payroll is $77,840 (rounded to the nearest dollar).

Jones Corporation Pays Its Employees Monthly