Question

Sabrina Duncan had gross earnings for the pay period ending 10/15/16 of $5,835. Her total gross earnings as of 9/30/16 were $104,400. If Social Security taxes are 6.2% on a maximum earnings of $106,800 per year, Sabrina's Social Security withheld from her 10/15/16 paycheck would be:A. $212.97B. $361.77C. $205.08D. $148.80

Answer 1

Answer:

option (A) $212.97

Explanation:

Data provided in the question:

Gross earnings for the pay period ending 10/15/16 = $5,835

Total gross earnings as of 9/30/16 = $104,400

Social Security tax rate = 6.2%

Now,

Total earnings

= Gross earnings for the pay period ending 10/15/16 + Total gross earnings as of 9/30/16

=  $5,835 + $104,400

= $110,235

since,The Social Security taxes are on a maximum earnings of $106,800 per year

therefore,

Sabrina's Social Security withheld from her 10/15/16 paycheck will be

= ( Total earnings - $106,800 ) × Social Security tax rate

= ( $110,235 - $106,800 ) × 0.062

= $3,435 × 0.062

= $212.97

Hence,

The answer is option (A) $212.97