Portia Grant is an employee who is paid monthly. For the month of January of the current year, she earned a total of $8,260. The FICA tax for social security is 6.2% and the FICA tax rate for Medicare is 1.45%. The FUTA tax rate of .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 $1,325.17. Her net pay for the month is:

Question

Quizplus · Accepted Answer

To calculate net pay, subtract all taxes from gross pay: Social Security tax ($8,260 * 6.2% = $512.12), Medicare tax ($8,260 * 1.45% = $119.77), FUTA tax ($7,000 * 0.6% = $42), SUTA tax ($7,000 * 5.4% = $378), and federal income tax ($1,325.17). Net pay = $8,260 - ($512.12 + $119.77 + $42 + $378 + $1,325.17) = $6,302.94.

Portia Grant Is an Employee Who Is Paid Monthly