Question 11.3: Employee Net Pay Karen Dunn’s weekly gross earnings for the...
Employee Net Pay
Karen Dunn’s weekly gross earnings for the week ending December 3 were $2,250, and her federal income tax withholding was $442.02. Assuming that the social security rate is 6% and Medicare is 1.5%, what is Dunn’s net pay?
Total wage payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,250.00
Less: Federal income tax withholding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $442.02
Social security tax ($2,250 × 6%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135.00
Medicare tax ($2,250 × 1.5%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \underline{33.75 } \underline{610.77 }
- Net pay . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \underline{\$ 1,639.23 }