Question

The deductions from erwins monthly pay are federal income tax of 100, state income tax of 2.5%, city income tax of 1.5% of gross, social security, and Medicare. His monthly net pay is 3,900 find his monthly gross pay

A) 4,000
B) 4,100
C) 4,200
D) 4,300

Answer 1

Erwin's monthly gross pay is calculated by considering all the deductions from the stated net pay of $3,900. After calculating the deductions of federal, state, city income tax, Social Security, and Medicare, the closest gross pay that matches the deductions is approximately $4,300.

Step-by-step explanation:

To calculate the monthly gross pay of Erwin, we must consider all the taxes and deductions he pays based on the net pay he receives.

We know that Erwin's net pay is $3,900. His deductions include federal income tax ($100), state income tax (2.5%), city income tax (1.5%), Social Security (6.2%), and Medicare (1.45%).

We can set up an equation to represent Erwin's deductions from his monthly gross income (G):
G - 100 - (0.025 × G) - (0.015 × G) - (0.062 × G) - (0.0145 × G) = 3,900

Combining like terms gives us:
G - 0.1165G - 100 = 3,900
0.8835G = 4,000

Dividing both sides by 0.8835 gives us: G = 4,527.93

Therefore, option D is closest to the actual amount, so Erwin's monthly gross pay is approximately $4,300.