Question

Maureen O'Malley earned $1,250 this week. The deductions from her pay are as follows:

FIT = $102.00

FICA - OASDI = $77.50

FICA - HI = $18.13

State income tax = $45.00

State disability insurance = $8.61

Health insurance premium = $36.00

Credit union contribution = $39.00

United Way fund contribution = $15.00

Maureen's employer just received a garnishment order (credit card debt of $7,500) against her pay.

Compute the following:

A. Maureen's disposable earnings

B.The amount of her pay subject to the garnishment

In addition, answer the following question:

C. The company received a second garnishment from another credit card company in the amount of $3,200. Would Maureen receive the second garnishment on her next paycheck assuming all the numbers are the same? Why or why not?

Be sure to show your calculations. This will allow your instructor to provide feedback on any mistakes and award partial credit.

Answer 1

Answer:-

A).Calculation of Maureen's disposable earnings;-

Particulars	Amount $ (Weekly)
Gross Pay Weekly	1250.00
Less:
Federal Income Taxes	-102.00
FICA - OASDI	-77.50
FICA - HI	-18.13
State income tax	-45.00
State disability insurance	-8.61
Health Insurance Premium	-36.00
Credit union contribution	-39.00
United Way Fund contribution	-15.00
Disposable Earnings	$908.76

B) AMount of pAy subject to Garnishment :-

Disposable Earnings * 25%

Wage Garnishment ($ / Paycheck) = 908.76 *25% = 227.19