Question

An employee earns $25 per hour and 2 times that rate for all hours in excess of 40 hours per week. Assume that the employee worked 48 hours during the week. Assume further that the social security tax rate was 6.0%, the Medicare tax rate was 1.5%, and federal income tax to be withheld was $239.15. a. Determine the gross pay for the week. $ b. Determine the net pay for the week. Round to two decimal places. $

Answer 1

Answer: The answer is as follows:

Step-by-step explanation:

Given that,

employee earns = $25 per hour

2 times that rate for all hours in excess of 40 hours per week

employee worked = 48 hours during the week

social security tax rate = 6.0%

Medicare tax rate = 1.5%

federal income tax = $239.15

(1) Gross pay for the week = excess of 40 hours per week × employee earns + 8 × employee earns × 2

= 40 × 25 + 8 × 25 × 2

= 1400

(2) Net pay for the week = Gross pay - social security tax rate - Medicare tax rate - federal income tax

= 1400 - 6% of 1400 - 1.5% of 1400 - 239.15

= 1400 - 84 - 21 - 239.15

= 1055.85