Question

Chin needs more money in his net pay each month, so he plans to reduce his federal income tax deduction from 12% to 11%. His monthly gross pay is $3,500, and his deductions before the change are listed in the table.

Deduction
Dollar Amount
Federal Income Tax
$420
State Income Tax
$95
Social Security
$89
Medicare
$40

What will be his new monthly net pay? Round your answer to the nearest dollar.
$2821
$2857
$2860
$2891

Answer 1

D

Step-by-step explanation:

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Answer 2

$2891

Step-by-step explanation:

If chine reduces his federal income deductions from 12% to 11%, the new federal income tax will be as below.

11% of $3500

= 11/100 x 3500

=0.11 x 3500

=$385.

Total deductions after this change will be

=$385 + $95 + $89 + $40

=$609

Net pay

=$3500- $609

=$2,891