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Exam 5: Employee Net Pay and Pay Methods

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Question 31

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Danny is a full-time exempt employee in Alabama, where the state income tax rate is 5%. He earns $78,650 annually and is paid semimonthly. He is married with four withholding allowances. His is health insurance is $100.00 per pay period and is deducted on a pre-tax basis. Danny contributes 5% of his pay to his 401(k) . Assuming that he has no other deductions, what is Danny's net pay for the period? (Use the percentage method for the federal income tax and the wage-bracket table for the state income tax. Do not round interim calculations, only round final answer to two decimal points.) Table 5. Percentage Method-2017 Amount for one Withholding Allowance

A) $2,245.53
B) $2,403.95
C) $2,361.72
D) $2,178.90

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Question 32

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Caroljane earned $1,120 during the most recent pay biweekly pay period. She contributes 4% of her gross pay to her 401(k) plan. She is single and has 1 withholding allowance. Based on the following table, how much Federal income tax should be withheld from her pay?

A) $115.00
B) $109.00
C) $121.00
D) $106.00

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Question 33

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Which of the following statements is/are true about Social Security tax deductions from gross pay? (Select all that apply.)

Garnishments are court-ordered amounts that an employer must withhold from an employee's pre-tax pay and remit to the appropriate authority.

Natalia is a full-time exempt employee who earns $215,000 annually, paid monthly. Her year-to-date pay as of November 30 is $197,083.33. How much will be withheld from Natalia for FICA taxes for the December 31 pay date? (Social Security maximum wage is $127,200. Do not round interim calculations, only round final answer to two decimal points.)

Julian is a part-time nonexempt employee in Nashville, Tennessee, who earns $21.50 per hour. During the last biweekly pay period he worked 45 hours, 5 of which are considered overtime. He is single with one withholding allowance (use the wage-bracket table) . What is his net pay? (Do not round interim calculations, only round final answer to two decimal points.)

The amount of federal income tax decreases as the number of allowances increases.

Which body issued Regulation E to protect consumers from loss of deposited funds?

The purpose of paycards as a pay method is to ________.

Federal income tax, Medicare tax, and Social Security tax amounts withheld from employee pay are computed based on gross pay, less pre-tax deductions, and deducted to arrive at net pay.

Charitable contributions are an example of post-tax voluntary deductions.

The percentage method of determining an employee's Federal income tax deductions ________.

Which of the following is used in the determination of the amount of federal income tax to be withheld from an employee per pay period?

State and Local Income Tax rates ________.

Olga earned $1,558.00 during the most recent weekly pay period. She is single with 2 withholding allowances and no pre-tax deductions. Using the percentage method, compute Olga's federal income tax for the period. (Do not round intermediate calculations. Round final answer to two decimal places.) Table 5. Percentage Method-2017 Amount for one Withholding Allowance

Garnishments may include deductions from employee wages on a post-tax basis for items such as: (Select all that apply.)

The percentage of the Medicare tax withholding ________.

What is an advantage of direct deposit from the employee's perspective?

Adam is a part-time employee who earned $495.00 during the most recent pay period. He is married with two withholding allowances. Prior to this pay period, his year-to-date pay is $6,492.39. How much should be withheld from Adam's gross pay for Social Security tax?

The factors that determine an employee's federal income tax are ________.