Question

Open any spreadsheet program and explore the different menus and commands it contains then create a new worksheet And enter the employee details as given in the table below and two more columns titled monthly tax and net basic pay. A tax of 6.2 percent is calculated on the basic pay as a social security tax. Calculate the monthly tax for each employee deduct the tax from the basic pay to calculate the net pay for each employee paste a screen grab of the worksheet you created.

Answer 1

To calculate the monthly tax and net basic pay for employees using a spreadsheet program, add columns for 'Monthly Tax' and 'Net Basic Pay', calculate the 6.2% Social Security tax on basic pay, and deduct it to find net pay. A screenshot of the worksheet demonstrates the calculations. Additionally, economists theorize that in practice employees pay both halves of payroll taxes due to lowered wages.

Step-by-step explanation:

To create a spreadsheet that calculates the monthly tax and net basic pay for employees, follow these steps in a spreadsheet program:

1. Create a new worksheet and enter the employee details.
2. Add two new columns titled 'Monthly Tax' and 'Net Basic Pay'.
3. Calculate the monthly tax by applying a 6.2% Social Security tax on the basic pay for each employee. This can be done by multiplying the basic pay by 0.062.
4. To calculate the net basic pay, subtract the monthly tax calculated from the basic pay.
5. Take a screenshot of the worksheet to show your work.

Regarding the labor market effects of payroll taxes, economists suggest that even though employers officially pay half of the payroll taxes, the cost is often passed on to employees through lower wages. Therefore, in reality, employees bear the burden of both halves of payroll taxes. This is an important consideration for employees and independent contractors in the workforce.