Question

Brooke Bennington works for JMK an year and earns a monthly salary of $12,800 There is no overtime pay Brooke's income tax withholding rate is 15% of gross pay In addition to payroll taxes, Brooke elects to contribute 2% monthly to United Way JMK also deducts $100 monthly for co-payment of the health Insurance Premium. As of September 30, Brooke had $115,200 of cumulative earnings.

Requirement:
a. Compute Brooke​'s net pay for October. ​

Answer 1

Brooke's net pay for October is calculated by subtracting the income tax withholding, United Way contribution, and health insurance co-payment from her gross salary. The result is a net pay of $10,524 for the month.

Step-by-step explanation:

To calculate Brooke’s net pay for October, we must deduct her income tax, United Way contribution, and health insurance co-payment from her gross salary.

• Gross Salary: $12,800
• Income Tax (15%): $12,800 * 0.15 = $1,920
• United Way Contribution (2%): $12,800 * 0.02 = $256
• Health Insurance Co-payment: $100
• Net Pay = Gross Salary - (Income Tax + United Way Contribution + Health Insurance Co-payment)

Net Pay = $12,800 - ($1,920 + $256 + $100)

Net Pay = $12,800 - $2,276

Net Pay = $10,524

Answer 2

$9,544.80

Step-by-step explanation:

For 2020, the maximum amount of salaries that are subject to social security taxes is $137,700. This means that Brooke's entire salary is subject to social security withholding.

Gross salary $12,800

• Federal income tax withholding $1,920
• United Way contribution $256
• FICA taxes (OASDI) withholding $793.60
• FICA taxes (Medicare) withholding $185.60
• Health insurance $100

Net pay = $9,544.80