Suppose you are single and work for a company that pays you $24/hour for all regular...

Suppose you are single and work for a company that pays you $24/hour for all regular hours and time -and-a-half for any weekly hours exceeding 40 hours.In a typical workweek, you work 44 hours. Assume you are paid biweekly. Find the following for each biweekly pay. The tax year does not matter.

1)Gross Wages

2)FICA

3)Medicare

4)SDI

5)State Tax (3.1%)

6)Local Tax (1.2%)

7)Federal Withholding (Assume 2 withholding allowances, use percentage method.)

8)Net earnings to the nearest penny.

9)What percent of gross is taken away for deductions? Write your answer to the nearest tenth of a percent.

Solutions

Expert Solution

Particulars	Amount ($)
Gross wages (80 x 24+ 8 x 36)	2208

FICA 6.2%	136.896
Medicare @ 1.45% (2208 x 1.45%)	32.016
SDI @0.1% (2208 x 0.1%)	2.208
State tax (2208 x 3.1%)	68.448
Local tax @1.2% (2208 x 1.2%)	26.496
Federal withholding @24% assuming the annual wages will continue in the current trend	529.92

Net earnings nearest penny
Gross wages (80 x 24+ 8 x 36)	2208
Less: All deductions (Note 1)	795.984
Net earnings nearest penny	1412.02

Percentage of gross income taken from deduction (795.984 x 100/2208)	36.05
Nearest 10^th of a percentage	40%

Working note 1:

FICA 6.2%	136.896
Medicare @ 1.45% (2208 x 1.45%)	32.016
SDI @0.1% (2208 x 0.1%)	2.208
State tax (2208 x 3.1%)	68.448
Local tax @1.2% (2208 x 1.2%)	26.496
Federal withholding @24% assuming the annual wages will continue in the current trend	529.92
Total deductions	795.984

ekkarill92 answered 7 months ago

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