Solve the problem. Use a FICA rate of 6.2%, a Medicare rate of 1.45%, and an SDI rate of 1%. Assume the person's
earnings will not exceed $31,800 for the year. Round to the nearest cent if needed.
-Bill Fox is paid 7% commission on sales. During a recent week, he had sales of $11,691.49 and allowances of $1,808. Find his Social Security tax, Medicare tax, and SDI deduction for the week.
A)$42.89, $10.03, $6.92
B)$58.59, $8.18, $9.45
C)$50.74, $11.87, $8.18
D)$42.46, $9.93, $6.85

Question

Quizplus · Accepted Answer

First, calculate Bill's earnings by subtracting allowances from sales: $11,691.49 - $1,808 = $9,883.49. Then, calculate his commission: 7% of $9,883.49 = $691.84. Social Security tax is 6.2% of $691.84 = $42.89, Medicare tax is 1.45% of $691.84 = $10.03, and SDI deduction is 1% of $691.84 = $6.92.

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