PE 11-3A Employee net pay

Bob Tappert’s weekly gross earnings for the week ending December 18 were $1,600, and his federal income tax withholding was $296.16. Assuming the social security rate is 6% and Medicare is 1.5% of all earnings, what is Tappert’s net pay?

Answer:

Total wage payment..........................................  $1,600.00 Less: Federal income tax withholding............  $296.16  Earnings subject to social security tax  $1,600.00   Social security tax rate .......................... ×         6%  Social security tax..................................  96.00  Medicare tax ($1,600 × 1.5%).................   24.00  416.16 Net pay ...............................................................  $1,183.84 

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