6-3: Income Statements

What is the net pay for Barbara's pay period if her gross pay is $469.75 and deductions include Social Security tax 6.2%, Medicare tax 1.45%, federal withholding tax $110.51, state withholding tax $66.62, retirement insurance contribution $9.00, disability insurance fee $2.56, medical insurance fee $12.00, and dental insurance fee $6.00?

• $215.75

• $198.46

• $227.13

• $240.89

Assuming Lorna's salary and deductions remain the same throughout the calendar year, how much will be taken out of her total annual gross salary for federal and state taxes if her biweekly pay stub shows federal tax $1,001.47 and state tax $280.89?

• $30,038.22

• $26,038.22

• $33,341.36

• $7,303.14

How much did Joanne pay in federal, state, and local taxes during the year if her W-2 form shows federal income tax withheld $15,851.00, state income tax $5,344.50, and local income tax $1,092.00?

• $22,287.50

• $21,287.50

• $23,287.50

• $20,287.50

What percent of Joanne's gross income did she actually take home if her W-2 form shows wages, tips, other compensation $76,350.00 and net pay $22,287.50?

• 27.8%

• 29.2%

• 25.5%

• 30.5%

What accounts for the difference between Amy's wages listed in Box 1 and her Social Security and Medicare wages listed in Boxes 3 and 5 if her W-2 form shows wages, tips, other compensation $78,900.00, Social Security wages $92,100.00, and Medicare wages and tips $92,100.00?

• Federal income tax and state tax

• Union dues and retirement plan contribution

• Tax-deferred contributions and FSA deposit

• Medical insurance and dental insurance fees

How much did Amy save in taxes by putting money in her tax-deferred and flexible spending accounts if she pays 20% federal tax and 7% state tax and contributed $1,000 to her tax-deferred retirement account and $1,000 to her FSA?

• $360

• $320

• $380

• $340

What entry should be in Box 1 of the W-2 form if the taxpayer's wages for the year are under the Social Security limit?

• $40,227.00

• $73,094.00

• $100,750.00

• $78,900.00

By how much did Martina reduce her annual federal taxes if she contributed $2,700 to her FSA and her wages before the deduction were $68,000, and she is taxed at a rate of 25% for her federal taxes?

• $700

• $650

• $725

• $675

What is Laurel's taxable income if her W-2 form reported total Medicare wages as $100,750, and she contributed $30 per weekly paycheck to her FSA and $75 per weekly paycheck to her retirement plan, and received a 1099 form from her bank for her savings account interest in the amount of $690 and a 1099 form from an employer that she did some consulting work for in the amount of $2,600?

• $103,340

• $103,040

• $103,140

• $103,440