Garrett Hudson earned $895 this week. The deductions from his pay were as follows:FIT$86.00FICA—OASDI55.49FICA—HI12.98State income tax27.75State disability insurance6.71Health insurance premium31.00Credit union contribution50.00United Fund contribution10.00Hudson's employer just received a garnishment order (credit card debt of $2,140) against his pay. Compute the following:Round your answers to the nearest cent.a. Hudson's disposable earnings$b. The amount of his pay subject to the garnishment$ Garrett Hudson earned $895 this week. The deductions from his pay were as follows:FIT$86.00FICA-OASDI55.49FICA-HI12.98State income tax27.75State disability insurance6.71Health insurance premium31.00Credit union contribution50.00United Fund contribution10.00Hudson's employer just received a garnishment order (credit card debt of $2,140) against his pay. Compute the following:Round your answers to the nearest cent.a. Hudson's disposable earningsb. The amount of his pay subject to the garnishment

Disposable earnings refers to the amount of portion of income left with the person after deducting taxes and obligations required to be paid. This amount can be spent or invested. It is calculated by deducting the deductions which can be availed by the person from his gross income.(A): Hudson’s disposable earnings: Particulars Amount ($) Wages per week 895 Less: FIT 86 FICA-OASDI 55.49 FICA-HI 12.98 State income tax 27.75 State disability insurance 6.71 Total deductions (188.93) Hudson’s disposable earnings $706.07 (B): The amount of his pay subject to garnishment: Maximum amount of disposable earnings that can be garnished to repay debt is the lesser of: 25% of disposable earnings for the week; or The amount of disposable earnings exceeding 30 times the federal minimum wage rate. Particulars Amount ($) 25% of Hudson’s disposable earnings (706.07*25%) $176.52 The amount of disposable earnings exceeding 30 times the federal minimum wage rate ($706.07-($7.25*30) $488.57 Therefore, the amount of his pay subject to garnishment is $176.52.

Answered: Garrett Hudson earned $895 this week.…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Garrett Hudson earned $895 this week. The deductions from his pay were as follows:

FIT	$86.00
FICA—OASDI	55.49
FICA—HI	12.98
State income tax	27.75
State disability insurance	6.71
Health insurance premium	31.00
Credit union contribution	50.00
United Fund contribution	10.00

Hudson's employer just received a garnishment order (credit card debt of $2,140) against his pay. Compute the following:

Round your answers to the nearest cent.

a. Hudson's disposable earnings	$
b. The amount of his pay subject to the garnishment	$

Garrett Hudson earned $895 this week. The deductions from his pay were as follows:
FIT
$86.00
FICA-OASDI
55.49
FICA-HI
12.98
State income tax
27.75
State disability insurance
6.71
Health insurance premium
31.00
Credit union contribution
50.00
United Fund contribution
10.00
Hudson's employer just received a garnishment order (credit card debt of $2,140) against his pay. Compute the following:
Round your answers to the nearest cent.
a. Hudson's disposable earnings
b. The amount of his pay subject to the garnishment

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