Question

portia grant is an employee who is paid monthly. for the month of january of the current year, she earned a total of 8,738. the fica tax for social security is 6.2% of the first $128,400 of employee earnings each calendar year and the fica tax rate for medicare is 1.45% of all earnings. the futa tax rate of 0.6% and the suta tax rate of 5.4% are applied to the first $7,000 of an employee's pay. the amount of federal income tax withheld from her earnings was $1,449.87. her net pay for the month is:

Answer 1

Answer:

Her net pay for the month is $6274.522

Explanation:

The computation of net pay is calculated by applying an equation which is shown below:

Net pay = Total pay - fica tax for social securtity - fica tax for medical care - federal income tax

where,

total pay is $8,738

fica tax for social security = total pay × fica tax rate for social security

                                          = 8,738 × 6.2%

                                          = $541.756

fica tax for medical care = total pay × fica tax rate for medical care

                                          = 8,738 × 5.4%

                                          = $471.852

And, federal income tax is $1449.87

So, the net pay is equals to

= $8,738 - $541.756 - $471.852 - $1449.87

= $6274.522

The suta tax rate would not be considered as full information is not given in the question. So, this part should be ignored.

Hence, her net pay for the month is $6274.522