Karen and Katie are looking at the company\'s health care options and trying to
ID: 2540949 • Letter: K
Question
Karen and Katie are looking at the company's health care options and trying to determine how much their net pay will decrease if they sign up for the qualified cafeteria plan offered by the company. Karen, a married woman with four exemptions, earns $2,000 per biweekly payroll. Katie, a single woman with one exemption, also earns $2,000 per biweekly payroll. The biweekly employee contribution to health care that would be subject to the cafeteria plan is $100. Compute the net pay for Karen and Katie. Assume that they are subject to federal income tax (using the wage-bracket method) and FICA taxes and have no other deductions from their pay. When wages fall on the end of a bracket, use the lower end. Use the Wage Bracket Method Tables for Income Tax Withholding in Appendix C. (Round your answers to 2 decimal places.)
Karen’s net pay if she declines to participate in the cafeteria plan
$1,720.00selected answer incorrect
Karen’s net pay if she participates in the cafeteria plan
$1,635.00selected answer incorrect
Katie’s net pay if she declines to participate in the cafeteria plan
$1,563.00selected answer incorrect
Katie’s net pay if she participates in the cafeteria plan
$1,488.00selected answer incorrect
Karen and Katie are looking at the company's health care options and trying to determine how much their net pay will decrease if they sign up for the qualified cafeteria plan offered by the company. Karen, a married woman with four exemptions, earns $2,000 per biweekly payroll. Katie, a single woman with one exemption, also earns $2,000 per biweekly payroll. The biweekly employee contribution to health care that would be subject to the cafeteria plan is $100. Compute the net pay for Karen and Katie. Assume that they are subject to federal income tax (using the wage-bracket method) and FICA taxes and have no other deductions from their pay. When wages fall on the end of a bracket, use the lower end. Use the Wage Bracket Method Tables for Income Tax Withholding in Appendix C. (Round your answers to 2 decimal places.)
Karen’s net pay if she declines to participate in the cafeteria plan
$1,720.00selected answer incorrect
Karen’s net pay if she participates in the cafeteria plan
$1,635.00selected answer incorrect
Katie’s net pay if she declines to participate in the cafeteria plan
$1,563.00selected answer incorrect
Katie’s net pay if she participates in the cafeteria plan
$1,488.00selected answer incorrect
Explanation / Answer
Answer
The net pay for Karen and Katie
Particulars Calculation Amount Karen's taxable income if she declines to participate in the cafeteria plan 2000 Karen's taxable income if she participates in the cafeteria plan 2000-100 1900 Katie's taxable income if she declines to participate in the cafeteria plan 2000 Katie's taxable income if she participates in the cafeteria plan 2000-100 1900Related Questions
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