For each employee, first calculate gross pay. Then determine taxable income used

Question

For each employee, first calculate gross pay. Then determine taxable income used to calculate federal income tax withholding, Social Security tax, and Medicare tax.

NOTE: For simplicity, all calculations throughout this exercise, both intermediate and final, should be rounded to two decimal places at each calculation.

1:An employee works 42 hours (42 - 40 were overtime hours) during a workweek in December of 2017. He earns $40.50/hour, with his employer paying 1.5 times the regular rate of pay for overtime hours. To date, he has earned $126,600 during the year. He has requested that his employer withhold 7% of gross pay, which is to be contributed to a 403(b) plan.

Taxable income for federal income tax withholding = $
Taxable income for social security tax = $
Taxable income for medicare tax = $

2:. An employee works 37 regular hours during a workweek in August of 2017. He was hired four years ago, earns a salary of $135,100/year, and is exempt from the overtime provisions of the FLSA. To date, he has received no compensation beyond his annual salary. He has requested that his employer withhold 8% of gross pay, which is to be contributed to a 401(k) plan.

Taxable income for federal income tax withholding = $
Taxable income for social security tax = $
Taxable income for medicare tax = $

3:An employee works 50 hours (50 - 40 were overtime hours) during a workweek in December of 2017. He earns $9,500/month, with his employer paying 1.5 times the regular rate of pay for overtime hours. To date, he has earned $109,700 during the year. He has requested that his employer withhold 13% of gross pay to contribute to a 403(b) plan.

Taxable income for federal income tax withholding = $
Taxable income for social security tax = $
Taxable income for medicare tax = $

For each employee listed, use the wage-bracket method to calculate federal income tax withholding. Refer to Appendix A, 2017 Federal Tax Tables in your textbook.

NOTE: For simplicity, all calculations throughout this exercise, both intermediate and final, should be rounded to two decimal places at each calculation.

1:Paul Yount (married; 7 federal withholding allowances) earned weekly gross pay of $605.

Federal income tax withholding = $

2:Paulina Robinson (single; 3 federal withholding allowances) earned biweekly gross pay of $1,245. She contributes $75 to a flexible spending account during the period.

Federal income tax withholding = $

3:Lacey Kunis (single; 2 federal withholding allowances) earned monthly gross pay of $3,090. For each period, she makes a 401(k) contribution of 11% of gross pay.

Federal income tax withholding = $

4:Francine Stewart (married; 4 federal withholding allowances) earned semimonthly gross pay of $1,420. She contributes $125 to a cafeteria plan during the period.

Federal income tax withholding = $

Explanation / Answer

Calculation Of Gross Pay Note: Since income is paid on hourly basis Formula shall be applied to calculate Gross pay per month = (hourly pay)x(hours/week)x52/12 For Overtime it is calculated in same way and added to Gross income       ($) Employee 1 Gross Income per month        7,020.00 Add:         Overtime(2*40.5*1.5*52/12)            526.50 Gross pay per month        7,546.50 Less:         7 % Gross pay contributed            528.26 to a 403(b) Plan Net Taxable Income        7,018.25 In this wages are paid on annual basis, therefore gross pay per month is calculated by dividing annual salary by 12       ($) Employee 2 Gross Income per month        1,125.00 Less:         13 % Gross pay contributed            146.25 Net Taxable Income            978.75 Already given in question Employee 3 Gross Income per month 9500 Less:         13 % Gross pay contributed 1235 Net Taxable Income 8265

Related Questions

Navigate

• Browse (All)
• Browse F
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.