In 2017,Willow Corporation had three employees.Two of the employees worked full-time and earned salaries of $25,000 each.The third employee worked part-time and earned $4,000.The employer timely paid state unemployment tax equal to 5.4 percent of each employee's wages up to $7,000.How much unemployment tax was paid to the state from Willow Corporation for 2017?

Question

Quizplus · Accepted Answer

For the two full-time employees, the employer paid unemployment tax on the first $7,000 of each employee's wages:

$25,000 x 2 x 5.4% = $2,700

For the part-time employee, the employer paid unemployment tax on the full $4,000 of wages:

$4,000 x 5.4% = $216

Adding these together:

$2,700 + $216 = $2,916

Therefore, the answer is (D) $972.

In 2017,Willow Corporation Had Three Employees