Question

Given the pay rate and hours worked, determine the gross earnings, Federal taxes (assuming 18% of gross earnings), state taxes (assuming 4% of gross earnings), social security deduction (assuming 7.05% of gross earnings), total deductions, and net pay.

Answer 1

Let us assume that the pay rate per hour = x

no. of hours worked = n

Gross earnings = x*n

Federal taxes = 18% of gross earnings

= 0.18(x*n)

State taxes = 4% of gross earnings

= 0.04(x*n)

Social security deduction = 7.05% of gross earnings

= 0.0705(x*n)

Total deductions = Federal taxes + State taxes +SSD

= 0.18(x*n) + 0.04(x*n) + 0.0705(x*n)

= 0.2905(x*n)

Net pay = Gross earnings - Total Deduction

Net pay = x*n - 0.2905(x*n)

Net pay = 0.7095(x*n)