Question

You are planning a trip to Spain in the summer of 2009. You estimate for an entire month in Spain, you will need $7,139.00 (This includes Airfare, room and board, daily expenses, and a Eurail Pass). You save for 7 months and your monthly gross salary is $2770.22. Given that Social Security is 6.2% of your semi-monthly income, Medicare is 1.45% of your semi-monthly income, your monthly expenses are $1,200, and you pay State and Federal taxes in the amount of $52.00 and $101.00 respectively semi-monthly, how much will you have saved up and will you have saved enough to visit Spain in August? Round all your answers to the nearest cent.

Answer 1

Save: $7,366.1

Yes

Explanation:

Answer 2

Save: $7,366.1

=> Enough to visit Spain in August

Explanation:

Semi monthly salary is: $2770.22/2 = $1385.11

- Semi-monthly payment for Social Security is: $1385.11 x 6.2% = $85.88

=> 7-month payment for Social Security is: $85.88 x 14 = $1,202.32

- Semi-monthly payment for Medicare is: $1385.11 x 1.45% = $20.08

=> 7-month payment for Medicare is: $20.08 x 14 = $281.12

- 7-month expenses are: $1,200 x 7 = $8,400

- 7-month payment for State taxes is: $52 x 14 =$728

- 7-month payment for Federal taxes is: $101 x 14 =$1,414

=> Total expenditure in 7 months: 1,202.32 + 281.12 + 8,400 + 728 + 1,414 = $12,025.44

Total salary in 7 months: $2770.22 x 7 = $19,391.54

=> Total saving in 7 months: 19,391.54 - 12,025.44 = $7,366.1

=> ENough to visit SPain in August