8. oliver gelfand earns $45,440 a year as a basketball coach and receives his pay on a semi - monthly basis…
8. oliver gelfand earns $45,440 a year as a basketball coach and receives his pay on a semi - monthly basis. how much does the school deduct per pay period for (a) social security tax and (b) medicare tax, (c.) what is the total monthly deduction?
Answer
Explanation:
Step1: Calculate semi - monthly pay
Semi - monthly means 24 pay periods in a year. So semi - monthly pay $=\frac{45440}{24}\approx1893.33$.
Step2: Calculate Social Security tax deduction per pay period
The Social Security tax rate is 6.2%. So the deduction per pay period is $1893.33\times0.062\approx117.39$.
Step3: Calculate Medicare tax deduction per pay period
The Medicare tax rate is 1.45%. So the deduction per pay period is $1893.33\times0.0145\approx27.45$.
Step4: Calculate total semi - monthly deduction
Total semi - monthly deduction is $117.39 + 27.45=144.84$.
Step5: Calculate total monthly deduction
Since semi - monthly deductions are $144.84$, total monthly deduction is $144.84\times2 = 289.68$.
Answer:
(a) Approximately $$117.39$ (b) Approximately $$27.45$ (c) $$289.68$