1st Semester Final Review -Financial Math

Front

What is the purpose of reconciling a check register?

Back

To ensure that the check register balance matches the bank statement balance by accounting for any transactions such as service charges or interest earned.

Front

How do you calculate net pay from gross pay?

Back

Net pay is calculated by subtracting all deductions (taxes, health insurance, savings plans) from gross pay.

Front

What is the formula to calculate Social Security deduction?

Back

Social Security deduction is calculated as 6.2% of the gross pay.

Front

What is the Medicare deduction percentage?

Back

The Medicare deduction percentage is 1.45% of the gross pay.

Front

What is FICA and what does it include?

Back

FICA stands for Federal Insurance Contributions Act, which includes Social Security and Medicare taxes.

Front

If a person's gross pay is $1,500, what is their Social Security deduction?

Back

$93 (calculated as 6.2% of $1,500).

Front

What is the total FICA deduction percentage?

Back

The total FICA deduction percentage is 7.65% (6.2% for Social Security and 1.45% for Medicare).

Front

How do you find the service charge from a bank statement?

Back

The service charge is a fee deducted by the bank, which should be subtracted from the check register balance during reconciliation.

Front

What is the significance of interest earned in a bank account?

Back

Interest earned is the money paid by the bank to the account holder for keeping their money in the bank, which should be added to the check register balance.

Front

What is gross pay?

Back

Gross pay is the total amount earned by an employee before any deductions are made.