Answer:
<u>The net amount paid to the employee is US$ 553.14</u>
Explanation:
Let's calculate the net amount paid to this employee:
1. Total hours worked = 48
Hourly wage for the first 40 hours = US$ 15
Hourly wage for hours over 40 hours = US$ 22.50 ( time and a half for all hours worked in excess of 40)
Total wage = 40* 15 + 8 * 22.50
Total wage = 600 + 180 = 780
<u>This employee earned US$ 780 before taxes and discounts </u>
2. Taxes and withheld are:
Federal income tax withheld= US$ 120
Social security tax rate= 6%
6% * 780 = 780 * 0.06 = US$ 46.80
Medicare tax rate= 1.5%
1.5% * 780 = 780 * 0.015 = US$ 11.70
State unemployment tax= 5.4% on the first $7,000
5.4% * 780 = 780 * 0.054 = US$ 42.12
Federal unemployment tax = 0.8% on the first $7,000
0.8% * 780 = 780 * 0.008 = US$ 6.24
Total taxes and withheld = 120 + 46.80+ 11.70+ 42.12 + 6.24
<u>Total taxes and withheld = US$ 226.86</u>
<u>3. </u>Net amount paid to this employee:
Net paid = Total earnings - taxes and withheld
Net paid = 780 - 226.86
<u>Net paid = US$ 553.14</u>
