Level 1
Chapter 9 – Section I – Exercise 11
Alan Kimball earns $22.34 per hour as a specialty chef at Le Bistro
Restaurant. If he worked 53 hours last week and was paid time-and-a
new gross earnings?
Level 2
Chapter 9 – Section I – Exercise 12
Paul Curcio earns $8.25 per hour for regular time up to 40 hours, time-and-a-half for overtime,
and double time for the midnight shift. Last week Paul worked 58 hours, including 6 on the
midnight shift. What are his gross earnings?
Level 3
Chapter 9 – Section I – Exercise 22
Bob Farrell works for a company that manufactures small appliances. Bob is paid $2.00
for each toaster, $4.60 for each microwave oven, and $1.55 for each food blender he
assembles. If he produced 56 toasters, 31 microwave ovens, and 79 blenders, what were
his total weekly gross earnings?
Level 1
Chapter 9 – Section I – Exercise 27
Katie Jergens works for Dynamic Designs selling clothing. She is on a salary of $140 per
week plus a commission of 7% of her sales. Last week, she sold 19 dresses at $79.95
each, 26 skirts at $24.75 each, and 17 jackets at $51.50 each. What were her total gross
earnings for the week?
Level 1
Chapter 9 – Section II – Exercise 2
What are the social security and Medicare withholdings for an executive whose annual
gross earnings are $118,430? (Use 6.2% up to $117,000 for social security tax, and
1.45% no wage limit for Medicare tax.)
Level 2
Chapter 9 – Section II – Exercise 3
Brian Hickman is an executive with Westco Distributors. His gross earnings are
$9,800 per month.
a. What are the withholdings for social security and Medicare for Brian in his January
paycheck? (Use 6.2% up to $117,000 for social security tax, and 1.45% no wage limit for Medicare tax.)
b. In what month will Brian’s salary reach the social security wage base limit?
Note: Use Excel’s Roundup function when calculating the number of months.
c. What are the social security and Medicare tax withholdings for Brian in the month
named in part b?
Level 1
Chapter 9 – Section III – Exercise 5
What are the social security and Medicare taxes due on gross earnings of $42,600 per
year for a self-employed person?
Level 2
Chapter 9 – Section III – Exercise 6
Lee Sutherlin is a self-employed electrical consultant. He estimates his annual net
earnings at $38,700. How much social security and Medicare must he pay this year?
Level 3
Chapter 9 – Section III – Exercise 12
North Beach Limousine Service employs 166 workers and has a gross payroll of $154,330
per week. Fringe benefits are 4 1/2% of gross payroll for sick days and maternity leave, 7.4%
for health insurance, 3.1% for the retirement fund, and $26.70 per employee for a stock
purchase plan.
a. What is the total weekly cost of fringe benefits for the company?
b. What percent of payroll does this represent?
c. What is the company’s annual cost of fringe benefits?
Level 2
Chapter 9 – Assessment Test – Exercise 5
Fergie Nelson assembles toasters for the Gold Coast Corporation. She is paid on a differential
piecework rate of $2.70 per toaster for the first 160 toasters and $3.25 for each toaster
over 160. If she assembled 229 units last week, how much were her gross earning?
Level 1
Chapter 9 – Assessment Test – Exercise 9
Brian Vincent booked $431,000 in new sales last month. Commission rates are 1% for
the first $150,000; 1.8% for the next $200,000; and 2.3% for portions beyond $350,000.
What was Brian’s total gross pay?
Level 3
Chapter 9 – Assessment Test – Exercise 21
Tim Ries earns $48,320 annually as a supervisor for the International Bank.
a. If the SUTA tax rate is 5.4% of the first $7,000 earned in a year, how much SUTA
tax must the bank pay each year for Tim?
b. If the FUTA tax rate is 6.0% of the first $7,000 earned in a year minus the SUTA
tax paid, how much FUTA tax must the bank pay each year for Tim?
Level 2
Chapter 9 – Assessment Test – Exercise 22
Universal Exporting has three warehouse employees: John Abner earns $422 per week, Anne Clark
earns $510 per week, and Todd Corbin earns $695 per week. The company‘s SUTA tax rate is 5.4%,
and the FUTA rate is 6.0% minus the SUTA. As usual, these taxes are paid on the
first $7,000 of each employee’s earnings.
a. How much SUTA and FUTA tax does the company owe on these employees for the
first quarter of the year?
b. How much SUTA and FUTA tax did Universal pay in the second quarter of the year?