Question

Lydia earns $540 per week. Each week, $32 is deducted for federal income taxes, $24.50 for FICA taxes, $29 for state taxes, and $74.50 for health insurance. Find the percentage of gross pay that Lydia takes home to the nearest percent. a) 70% b) 60% c) 50% d) 40%

Answer 1

Lydia takes home approximately 70% of her gross pay. Option a is correct.

Step-by-step explanation:

To find the percentage of gross pay that Lydia takes home, we need to subtract the deductions from her gross pay and then calculate what percentage it is of her gross pay.

Gross pay = $540

Total deductions = $32 + $24.50 + $29 + $74.50

= $160

Find the Net pay:

Net pay (take home pay) = Gross pay - Total deductions

= $540 - $160

= $380

Now find the percentage of net pay:

Percentage of net pay = (Net pay / Gross pay) * 100%

= ($380 / $540) * 100%

= 70.37%

≈ 70%

Therefore, Lydia takes home approximately 70% of her gross pay. Option a is correct.