PSb 3-2 Calculate Gross Pay & Taxable Pay

For each employee, first calculate gross pay. Then determine taxable income used to calculate federal income tax withholding, Social Security tax, and Medicare tax.

NOTE:For simplicity, all calculations throughout this exercise, both intermediate and final, should be rounded to two decimal places at each calculation.

An employee works 35 regular hours during a workweek in August of 2019. He was hired four years ago, earns a salary of $134,700/year, and is exempt from the overtime provisions of the FLSA. To date, he has received no compensation beyond his annual salary. He has requested that his employer withhold 8.5% of gross pay, which is to be contributed to a 401(k) plan.

Taxable income for federal income tax withholding = $

Taxable income for social security tax = $

Taxable income for medicare tax