Question

An employee earns $36 per hour and 1.75 times that rate for all hours in excess of 40 hours per week. Assume that the employee worked 50 hours during the week, and that the gross pay prior to the current week totaled $52,200. Assume further that the social security tax rate was 6.0%, the Medicare tax rate was 1.5%, and federal income tax to be withheld was $476.
If required, round your answers to two decimal places.

a) Determine the gross pay for the week.

b) Determine the net pay for the week.

Answer 1

Answer:

Normal Rate is $40 per hr

Overtime Rate is ($36.00 x 1.75) = $63.00.

Total hrs worked =50 hrs

Hence payment is:

(40hrs x $36) Normal Rate =$1,440

(10hrs * $63) Overtime Rate = $630

Gross Pay. $2,070

b) Since our prior gross pay was $52,200 and current gross pay is $2,070 this is still under the $100,000

Hence, we need to Pay tax 6% on the current gross pay amt.

Social Sec. Tax = $2,070 - 6% = $124.2

Medicare Tax = $2,070 - 1.5% = $31.05

Federal Income Tax = $476

Hence Net Pay:

.$2,070 - $124.2 - $31.05- $476

= $1,438.75

Net Pay= $1,438.75

Explanation: