An employee earned $4,600 in February working for an employer. The FICA tax rate for Social Security is 6.2% of the first $118,500 earned during each calendar year and the FICA tax rate for Medicare is 1.45% of all earnings. The employee has $644 in federal income taxes withheld and has voluntary deductions for health insurance of $50 and contributes 10% of gross pay to a retirement plan each month. The employer pays the $200 remainder of the health insurance premium and an equal amount of contribution to the retirement fund. What is the amount of net pay for the employee for the month of February?
A) $3,094.10
B) $3,496.00
C) $3,604.10
D) $3,446.00
E) $2,634.10
A) $3,094.10
Explanation: Net Pay = Gross Pay ? Federal Income Tax ? FICA ? SS Tax ? FICA ? Medicare
Tax ? Health Insurance ? Retirement Plan
Net Pay = $4,600 ? $644 ? $285.20* ? $66.70** ? $50 ? ($4,600 × .10) = $3,094.10
*FICA—SS Tax $4,600 × 0.062 = $285.20
**FICA—Medicare Tax $4,600 × 0.0145 = $66.70
You might also like to view...
________ is defined as the process by which managers ensure that resources are used effectively and efficiently in the accomplishment of organizational objectives
A) Review B) Monitor C) Control D) Accommodation
The advantages of financial leverage accrue primarily to
A) management. B) stockholders. C) the government. D) creditors.
Which training model combines cognitive, affective, and behavioral aspect of training?
a. area training model b. cultural awareness model c. interaction approach d. multidimensional approach
Corporations have perpetual existence
a. True b. False Indicate whether the statement is true or false