Question

Portia Grant is an employee who is paid monthly. For the month of January of the current year, she earned a total of 8,988. 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 $1,491.37. Her net pay for the month is: (Round your intermediate calculations to two decimal places.) Multiple Choice $6,566.00 $6,809.04 $5,074.63 $7,366.30 $6,375.04

Answer 1

Answer:

$6,809.04

Explanation:

Calculation to determine what her net pay for the month is

Gross Pay (a) $8,988

Less: Deductions

Social Security Tax $557.26

($8,988 * 6.2%)

Medicare Tax $130.33

($8,988 * 1.45%)

Federal income Tax $1,491.37

Total Deductions (b) $2,178.96

Net Pay (a-b) $6,809.04

($8,988-$2,178.96)

Therefore her net pay for the month is $6,809.04