Free APA CPP-Remote Practice Exam with Questions & Answers | Set: 9

Comprehensive and Detailed in Depth Explanation:

✅ The employer ' s Medicare contribution is calculated at 1.45% of all Medicare-eligible wages — there is no wage base limit for Medicare (unlike Social Security, which caps at $160,200 in 2023 and $168,600 in 2024).

NOTE: The Additional Medicare Tax of 0.9% only applies to employees earning over $200,000 , and only on the portion above that threshold — it is not paid by employers.

Step-by-Step Calculation:

???? Employee 1:

Total wages: $210,000.00

Employer Medicare: $210,000 × 1.45% = $3,045.00

???? Employee 2:

Wages: $30,500.00

Employer Medicare: $30,500 × 1.45% = $442.25

???? Employee 3:

Wages: $60,000.00

Employer Medicare: $60,000 × 1.45% = $870.00

Total Medicare Contribution by Employer:

$3,045.00 + $442.25 + $870.00 = $4,357.25

✅ Therefore, the correct answer is: B – $4,357.25

Incorrect Option Breakdown:

A ($3,756.95): Doesn’t account for all three employees.

C ($4,447.25): Possibly includes 0.9% Additional Medicare Tax — which is not paid by the employer .

D ($7,061.75): Too high — may include both employer and employee sides.