Question

Calculate Payroll An employee earns $44 per hour and 1.5 times that rate for all hours in excess of 40 hours per week. Assume that the employee worked 60 hours during the week, and that the gross pay prior to the current week totaled $63,800. Assume further that the social security tax rate was 6.0%, the Medicare tax rate was 1.5%, and federal income tax to be withheld was $708.a. Determine the gross pay for the week.$If applicable, round your final answer to two decimal places.b. Determine the net pay for the week.$

Answer 1

The correct answer for option (a) is $3,080 and for option (b) is $2,141.

Step-by-step explanation:

(a). Current pay = $44

After 40 hours, Pay = $44 × 1.5 = $66

So, we can calculate the gross pay by using following formula:

Gross pay = (40 hours × $44 ) + (20 hours × $66)

= $1,760 + $1,320

= $3,080

(b).

Security Tax = Gross pay × 6% = $3,080 × 6% = $184.8

Medicare Tax = Gross pay × 1.5% = $3,080 × 1.5% = $46.2

Federal Income Tax = $708

So, we can calculate the net pay by using following formula:

Net Pay = $3,080 - $184.8 - $46.2 - $708

= $2,141