Question

1.Your primary job’s gross income is $3,500.00/month, and your second job’s realized income is $368.49/month. Deductions are FICA (7.65%), federal tax withholding (10.75%), and state tax withholding (8.35%). How much is the income on your monthly budget?

2.Your fixed expenses are $1,035.65/month and are 36% of your realized income. use proportions to compute the realized income on your budget.

Answer 1

Part 1
Total income per month = $3,500+$368.49 = $3,868.49
Total deductions = 7.65%+10.75%+8.35% = 26.75% = 0.2675

Net income = Total income - Deductions = Total deductions (1-0.2675) = $3,868.49 (1-0.2675) = $2,833.67

Part 2
Fixed expenses = $1,035.65 which is 36% of realized income.

Then, if realized income is 100%;
$1,035.65 ------------------ 36%
$ Realized income ----- 100%
Therefore,
Realized income = 1,035.65*100/36 = $2,876.81