Final answer:
Abby contributes $2,730 annually to her family health care coverage, while her employer contributes $15,470 annually, resulting in a total annual cost of $18,200 for the coverage.
Step-by-step explanation:
The question involves calculating Abby's and her employer's annual contributions for family health care coverage. Abby pays 15% of the cost, and $105.00 is deducted from each of her bi-weekly paychecks. To find the annual contribution, we have to calculate how much is deducted per year and then find the total cost of the insurance.
First, we calculate the amount deducted from Abby's paycheck annually:
There are 52 weeks in a year, so Abby receives 26 paychecks (52 weeks ÷ 2).
Abby's annual contribution = 26 paychecks × $105.00 per paycheck = $2,730.
Next, we calculate the total cost of the insurance:
If Abby pays 15% of the total cost, then her employer pays the remaining 85%. Since Abby's contribution is $2,730, which is 15% of the total cost, we can use this information to find the total annual cost (C).
$2,730 = 15% of C
C = $2,730 ÷ 0.15
C = $18,200
Finally, we determine the employer's contribution:
Employer's contribution = 85% of total cost
Employer's contribution = 85% × $18,200
Employer's contribution = $15,470
Therefore, Abby contributes $2,730 annually, and her employer contributes $15,470 annually to the family health care coverage.