Income Tax Fundamentals
Directions: Be sure to save an electronic copy of your answer before submitting it to Ashworth College for grading. Unless otherwise stated, answer in complete sentences, and be sure to use comet English, spelling, and grammar. Refer to the "Format Requirements' page for specific format requirements.
1. Maeda Company has the following employees on the payroll:
Employee Mo.. Semimonthly Witholding Name Mans Na. Allowances
Amal 5 54.000
Miguel M 15.000
Byron S S4.600 2
Hiroko M 56.500 0
Using the information above:
a. Calculate the FUTA tax liability for 2013. Assume that Maeda Company has paid all amounts due during the year.
b. If the payroll is consistent from quarter to quarter, how much would be remitted in FUTA taxes in each of the four quarters in 2013?
2. Quince Company has book income of $120,000
properly determined in accordance with financial accounting principles. The following information is also available:
- The company received a $10,000 dividend from a large publicly-traded domestic corporation of which it owns less than 20%.
- Income tax expense on the financial statements was $30,000.
- Depreciation expense on the financial statements is $25,000 less than depreciation expense determined using tax laws.
- The company received life insurance proceeds of $15,000.
- Charitable contributions of $20,000 were made.
Determine the taxable income of Quince Company.