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Matthew earned $1,000 this pay period. He will pay $94.12 in federal taxes. He does not have to pay state income tax. Social security tax is 6.2%, which is $62. Medicare is 1.45%, which is $14.50. Calculate Matthew's net pay with all mandatory taxes included.

A.
905.88
B.
843.88
C.
815.23
D.
829.38

1 answer

To calculate Matthew's net pay with all mandatory taxes included, we need to subtract the total taxes from his earnings of $1,000.

  1. Federal taxes: $94.12
  2. Social Security tax: 6.2% of $1,000 = $62
  3. Medicare tax: 1.45% of $1,000 = $14.50

Now, we add the taxes together:

  • Total taxes = Federal taxes + Social Security tax + Medicare tax
  • Total taxes = $94.12 + $62 + $14.50 = $170.62

Now, we subtract the total taxes from his earnings:

  • Net pay = Earnings - Total taxes
  • Net pay = $1,000 - $170.62 = $829.38

So, Matthew's net pay is D. 829.38.