Question

1)An employee has gross earnings of $2,000 with withholdings of 6.2% FICA-OASDI, 1.45 % FICA-Medicare, $100 for federal income tax and $30 for state income tax. How much is the gross pay?

	A)	$2000.00
	B)	$781.15
	C)	771.15
	D)	791.15

2)An employee has gross earnings of $1,200 with withholdings of 6.2% FICA-OASDI, 1.45% FICA-Medicare, $50 for federal income tax and $10 for state income tax. How much is the net pay?

	A)	$900.00
	B)	$781.15
	C)	$1,048.20
	D)	$791.15

Answer 1

1)

The correct answer is A) $2,000

Supporting explanations:

Gross earnings of $2,000 is the gross pay which is before all tax deductions, hence, the gross pay is $2,000.

2)

The correct answer is C) $1,048.20.

Supporting calculations:

Gross Pay	$1,200
Less: FICA-OASDI ($1,200*6.2/100)	($74.40)
Less: FICA-Medicare ($1,200*1.45/100)	($17.40)
Less: Federal Income Tax	($50)
Less: State Income Tax	($10)
Net Pay	$1,048.20

Therefore, net pay is $1,048.20.