[The following information applies to the questions displayed below.] Wayland Custom Woodworking is a firm that manufactures custom cabinets and…

[The following information applies to the questions displayed below.]

Wayland Custom Woodworking is a firm that manufactures custom cabinets and woodwork for business and residential customers. Students will have the opportunity to establish payroll records and to complete a month of payroll information for Wayland. 

Wayland Custom Woodworking is located at 1716 Nichol Street, Logan, Utah, 84321, phone number 435-555-9877. The owner is Mark Wayland. Wayland’s EIN is 91-7444533 and his Utah Employer Account Number is 999-9290-1. Wayland has determined it will pay their employees on a semimonthly basis.

 Students will complete the payroll for the final quarter of 2015, and will file fourth quarter and annual tax reports on the appropriate dates. When writing out the dollar amount for each check, spell out all words and the cents are presented over 100, for example 50 cents would be 50/100.

Federal income tax should be computed using the percentage method tables in Appendix C. FUTA information is in the table below. The Utah state income tax rate and the SUTA (UI) rate are in the table below.

Rounding can create a challenge. For these exercises, the rate for the individuals is not rounded. So take their salary and divide by 2,080 (52 weeks at 40 hours per week) for full time, nonexempt employees. For example, Varden’s salary is $42,000 and is a nonexempt employee, so the calculation will be $42,000/2,080, which would give you $20.19231 per hour. Exempt employees salaries are divided by 24 (number of payrolls for semimonthly.) For example, Chinson’s salary is $24,000 and is a full time employee, so the calculation will be $24,000/24, which would give you $1,000. After this hourly rate is determined, than it can be applied to the number of hours worked. After the gross pay has been calculated, round this number to only two decimal points prior to calculating taxes or other withholdings.

For the completion of this project the following information can be located in Appendix C. Students will use the Percentage method for federal income tax and the tax tables have been provided for Utah. Both 401(k) and insurance are pretax for federal income tax and Utah income tax. Round calculations to get to final tax amounts and 401(k) contributions after calculating gross pay.

   Federal Withholding Allowance (less 401(k), Section 125)$166.70 per allowance claimed  Semimonthly Federal Percentage Method Tax TableAppendix C, Page 293, Table #3  Federal Unemployment Rate (Federal unemployment rate less Section 125 health insurance)0.6% on the first $7,000 of wages State Withholding Rate (less 401(k), Section 125)See Utah Schedule 3 State Unemployment Rate (less Section 125)2.6% on the first $31,300 of wages 

Wayland Custom Woodworking

Balance sheet

9/30/2015Assets Liabilities & Equity  Cash$1,125,000.00 Accounts Payable$112,490.00    Supplies 27,240.00 Salaries and Wages Payable    Office Equipment 87,250.00 Federal Unemployment Tax Payable    Inventory 123,000.00 Social Security Tax Payable    Vehicle 25,000.00 Medicare Tax Payable    Accumulated Depreciation, Vehicle   State Unemployment Tax Payable    Building 164,000.00 Employee Federal Income Tax Payable    Accumulated Depreciation, Building   Employee State Income Tax Payable    Land 35,750.00 401(k) Contributions Payable    

 Employee Medical Premiums Payable    Total Assets 1,587,240.00 Notes Payable 224,750.00    

 Utilities Payable      Total Liabilities 337,240.00             Owners’ Equity 1,250,000.00      Retained Earnings –      Total Equity 

1,250,000.00 

    Total Liabilities and Equity 1,587,240.00       

October 1:

Wayland Custom Woodworking (WCW) pays its employees according to their job classification. The following employees comprise Wayland’s staff:

  Employee NumberName and AddressPayroll information  00-ChinsAnthony Chinson

530 Sylvann Avenue

Logan, UT 84321

435-555-1212

Job title: Account ExecutiveMarried, 1 withholding allowance

Exempt

$24,000/year + commission

Start Date: 10/1/2015

SSN: 511-22-3333  00-WaylaMark Wayland

1570 Lovett Street

Logan, UT 84321

435-555-1110

Job title: President/OwnerMarried, 5 withholding allowances

Exempt

$75,000/year

Start Date: 10/1/2015

SSN: 505-33-1775  01-PeppiSylvia Peppinico

291 Antioch Road

Logan, UT 84321

435-555-2244

Job title: CraftsmanMarried, 7 withholding allowances

Exempt

$43,500/year

Start Date: 10/1/2015

SSN: 047-55-9951  01-VardeStevon Varden

333 Justin Drive

Logan, UT 84321

435-555-9981

Job title: CraftsmanMarried, 2 withholding allowances

Nonexempt

$42,000/year

Start Date: 10/1/2015

SSN: 022-66-1131  02-HissoLeonard Hissop

531 5th Street

Logan, UT 84321

435-555-5858

Job title: Purchasing/ShippingSingle, 4 withholding allowances

Nonexempt

$49,500/year

Start Date: 10/1/2015

SSN: 311-22-6698  00-StudeStudent F Success

480-555-3322

Job title: Accounting ClerkSingle, 1 withholding allowance

Nonexempt

$36,000/year

Start Date: 10/1/2015

SSN: 555-55-5555 

Voluntary deductions for each employee are as follows:

Name          Deduction          ChinsonInsurance: $50/paycheck401(k): 3% of gross pay  WaylandInsurance: $75/paycheck401(k): 6% of gross pay  PeppinicoInsurance: $75/paycheck401(k): $50 per paycheck  VardenInsurance: $50/paycheck401(k): 4% of gross pay  HissopInsurance: $75/paycheck401(k): 3% of gross pay  StudentInsurance: $50/paycheck401(k): 3% of gross pay 

The departments are as follows:

      Department 00: Sales and Administration

      Department 01: Factory workers

      Department 02: Delivery and Customer service

1. You have been hired as of October 1 as the new accounting clerk. Your name is Student F. Success and your employee number is 00-STUDE. Your Utah drivers license is 887743 expiring in 7/2018 and social security number is 555-55-5555, and you are non-exempt and paid at a rate of $36,000 per year. Using the information provided, complete the W-4 and the I-9 to start your employee file. Complete as if Single with 1 withholding, you decide to contribute 3% to 401(k) and health insurance is $50 per pay period.

2. Complete the headers of the Employees’ Earnings Records for all company employees. Enter the YTD earnings for each employee.

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