a. OASDI tax b. HI tax 44
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Problem Information
Use the following tax rates, ceiling and maximum taxes:
Employee and Employer OASDI:
Employee* and Employer HI:
Self-employed OASDI:
Self-employed HI:
*Employee HI: Plus an additional 0.9% on wages over $200,000. Also applicable to self-employed.
6.20%
1.45%
12.4%
a. OASDI tax
b. HI tax
2.9%
$147,000
No limit
$147,000
No limit
$9,114.00
No maximum
$18,228.00
No maximum
Rounding Rules: Unless instructed otherwise compute hourly rate and overtime rates as follows:
1. Carry the hourly rate and the overtime rate to 3 decimal places and then round off to 2 decimal places (round the hourly rate to 2 decimal places
before multiplying by one and one-half to determine the overtime rate).
2. If the third decimal place is 5 or more, round to the next higher cent.
3. If the third decimal place is less than 5, drop the third decimal place.
Also, use the minimum hourly wage of $7.25 in solving these problems and all that follow.
On the last weekly pay of the first quarter, Lorenz is paid her current pay of $90 per day for four days worked and one day sick pay (total $450). Sh
is also paid her first-quarter commission of $1,200 in this pay. How much will be deducted for:
Round your answers to the nearest cent.
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