Question

You are planning a trip to Disney World in Florida. You estimate for week at Disney World, you will need $1,600.00 (This includes Airfare, room and board, daily expenses, and travel). You save for 5 months and your monthly gross salary is $1,675.00. Given that Social Security is 6.2% of your biweekly income, Medicare is 1.45% of your biweekly income, your monthly expenses are $975.23, and you pay State and Federal taxes in the amount of $35.00 and $75.51 respectively biweekly, how much will you have saved up and will you have saved enough to visit Disney World in December? Round all your answers to the nearest cent. a. $1,508.25; no c. $1,753.05; yes b. $1,523.43; no d. $1,788.06; yes

Answer 1

c. $1,753.05; yes

Explanation:

All calculations below are done on a monthly basis.

Gross salary in 1 month: $1675

Deduct 6.2% from gross salary:

0.062 * $1675 = $103.85

$1675 - $103.85 = $1571.15

Deduct 1.45% from gross salary:

0.0145 * 1675 = $24.29

$1571.15 - $24.29 = $1546.86

Deduct $975.23:

$1546.86 - $975.23 = $571.63

The expenses of $35 and $75.51 are biweekly. Since we are calculating per month, we multiply each of the expenses by 2.

Deduct 2($35) and 2($75.51):

$571.63 - $70 - $151.02 = $350.61

The amount saved per month is $350.61.

In 5 months, the amount saved is 5 * $350.61 = $1753.05

$1753.05 is greater than $1,600.

Answer: c. $1,753.05; yes