An employee receives an hourly wage rate of $15, with time and a half for all hours worked in excess of 40 during the week. Payroll data for the current week are as follows: hours worked, 46; federal income tax withheld, $110; cumulative earnings for the year prior to this week, $24,500; social security tax rate, 6.0%; Medicare tax rate, 1.5%; state unemployment compensation tax, 3.4% on the first $7,000; and federal unemployment compensation tax, 0.8% on the first $7,000. What is the net amount to be paid to the employee?
A) $569.88
B) $539.00
C) $625.00
D) $544.88

Question

Quizplus · Accepted Answer

Explanation:Gross earnings: 46 hours x $15 = $690Overtime earnings: 6 hours x $15 x 1.5 = $135Total earnings: $690 + $135 = $825Federal income tax withheld: $110Social security tax: $825 x 6.0% = $49.50Medicare tax: $825 x 1.5% = $12.38State unemployment compensation tax: $7,000 x 3.4% = $238Federal unemployment compensation tax: $7,000 x 0.8% = $56Total deductions: $110 + $49.50 + $12.38 + $238 + $56 = $465.88Net amount to be paid to the employee: $825 - $465.88 = $359.12

An Employee Receives an Hourly Wage Rate of $15, with Time