Question

1.

Rhonda Brennan found her first job after graduating from college through the classifieds of the Miami Herald. She was delighted when the offer came through at $14.10 per hour. She completed her W-4 stating that she is married with a child and claims an allowance of 3. Her company will pay her biweekly for 80 hours (assume a tax rate of 6.2% on $118,500 for Social Security and 1.45% for Medicare).

Calculate her take-home pay for her first check. (Use Table 9.1 and Table 9.2) (Round your answer to the nearest cent.)

Net pay            $

2.

The Social Security Administration increased the taxable wage base from $121,100 to $122,200. The 6.2% tax rate is unchanged. Joe Burns earned over $120,000 each of the past two years.

a. What is the percent increase in the base? (Round your answer to the nearest hundredth percent.)

Percent increase             %

b. What is Joe’s increase in Social Security tax for the new year? (Round your answer to the nearest cent.)

Increase in Social Security tax

Answer 1