Reference no: EM132676947

Question - For each employee, first calculate gross pay. Then determine taxable income used to calculate federal income tax withholding, Social Security tax, and Medicare tax.

NOTE: For simplicity, all calculations throughout this exercise, both intermediate and final, should be rounded to two decimal places at each calculation.

1: An employee works 42 hours (42 - 40 were overtime hours) during a workweek in December of 2019. He earns $40.50/hour, with his employer paying 1.5 times the regular rate of pay for overtime hours. To date, he has earned $132,300 during the year. He has requested that his employer withhold 7% of gross pay, which is to be contributed to a 403(b) plan.

2: An employee works 36 regular hours during a workweek in August of 2019. He was hired four years ago, earns a salary of $135,500/year, and is exempt from the overtime provisions of the FLSA. To date, he has received no compensation beyond his annual salary. He has requested that his employer withhold 6.5% of gross pay, which is to be contributed to a 401(k) plan.

3: An employee works 50 hours (50 - 40 were overtime hours) during a workweek in December of 2019. He earns $9,500/month, with his employer paying 1.5 times the regular rate of pay for overtime hours. To date, he has earned $109,700 during the year. He has requested that his employer withhold 13% of gross pay to contribute to a 403(b) plan.