Statement of Earnings by xiaopangnv

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									                        Section 2-6

         Statement of Earnings



Presented by M J Lund
Review of Income Tax and the
         W-4 form
 http://www.irs.ustreas.gov/app/unders
 tandingTaxes/jsp/hows/tt/module01/t
           ax_mod1_1.jsp
Net pay is the amount of money
  you actually take home after
your deductions. What are some
of the deductions (withholdings)
 we have discussed in this unit?


    Social Security and Medicare
       Statement of Earnings
• Information on your pay stub.
• Shows all of your deductions.
• To find net pay. Add together all of
 your deductions and subtract that
 amount from the total pay.
              Example 1
Mary North earns $785 a week. She is
single and claims one allowance . She
pays 6.2% for Social Security and
1.45% for Medicare. The state she lives
in has a 2% state tax on gross pay. Also,
$25 is deducted each week for health
care. Find her net pay. (Don’t forget the
Federal Tax deduction.)
              Answer Example 1
 Mary North earns $785 a week. She is single and claims
 one allowance. She pays 6.2% for Social Security and
 1.45% for Medicare. The state she lives in has a 2% state tax
 (based on gross pay). Also, $25 is deducted each week for
 health care. Find her net pay. (Don’t forget the Federal Tax
 deduction.)
Earns $785 a week - total deductions = net pay
Total deductions = Social Security 0.062 x 785 = $48.67
                   + Medicare      0.0145 x 785 = $11.38
                   + State Tax      0.02 x 785 = $15.70
                   + Federal Tax                 $115.00
                  + Health Care                   $25.00
                                                 $215.75
          $785.00 - $215.75 =$569.25
              Example 2
Jim West earns $956 a week. He is
married and claims 2 allowances. He
pays 6.2% for Social Security and
1.45% for Medicare. The state he lives
in has a 3% state tax on gross pay. Also,
$110 is deducted each week for health
care. Find his net pay. (Don’t forget the
Federal Tax deduction.)
              Answer Example 2
 Jim West earns $956 a week. He is married and claims two
 allowances. He pays 6.2% for Social Security and
 1.45% for Medicare. The state he lives in has a 3% state tax
 (based on gross pay). Also, $110 is deducted each week for
 health care. Find his net pay. (Don’t forget the Federal Tax
 deduction.)
Earns $956 a week - total deductions = net pay
Total deductions = Social Security 0.062 x 956 = $59.27
                   + Medicare      0.0145 x 956 = $13.86
                   + State Tax        0.03 x 956 = $28.68
                   + Federal Tax                   $96.00
                   + Health Care                  $110.00
                                                  $307.81
          $956.00 - $307.81 = $648.19
                 Example 3
Don East earns $750 a week. He is married, has
one child, and claims 4 allowances. He pays
6.2% for Social Security and 1.45% for Medicare.
The state he lives in has a 3% state tax on gross
pay. Also, $150 is deducted each week for health
care. Find his net pay.
(Don’t forget the Federal Tax deduction.)
                  Errors Example 3
    Don East earns $750 a week. He is married, has one child
    and claims 4 allowances. He pays 6.2% for Social Security
    and 1.45% for Medicare. The state He lives in has a 3% state
    tax on gross pay. Also, $150 is deducted each week for
    health care. Find his net pay.
    (Don’t forget the Federal Tax deduction.)
  Earns $750 a week - total deductions = net pay
    Total deductions = Social Security 0.062 x 750 = $46.50
The regular office person + Medicare    0.0145 x 750 = $10.87
who calculates the pay is + State Tax    0.3 x 750 = $225.00
out this week. Her        + Federal Tax                $57.00
Replacement is confused.
                          + Health Care               $150.00
Find the errors she made.
                                                      $489.37
               $750.00 - $489.37 =$1239.37
        Errors (in white) Example 3
   Don East earns $750 a week. He is married, has one child and claims 4
   allowances. He pays 6.2% for Social Security and 1.45% for Medicare.
   The state He lives in has a 3% state tax on gross pay. Also, $150 is
   deducted each week for health care. Find his net pay.
   (Don’t forget the Federal Tax deduction.)
Earns $750 a week - total deductions = net pay
         Total deductions = Social Security 0.062 x 750 = $46.50
                            + Medicare     0.0145 x 750 = $10.88
     3% not 30%              + State Tax      0.3 x 750 = $22.50
   4 allowances not 3     + Federal Tax                    $48.00
                           + Health Care                  $150.00
                                                          $277.88



                $750.00 - $277.88 = $472.12
    Assignment



• Hmk pg 130 # 3-7

								
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