Lee Provo Is Paid $8 Per Hour,plus Time-And-One-Half for Hours

question 76

Essay

Lee Provo is paid $8 per hour,plus time-and-one-half for hours over 40 for a given week.During the week of January 21,Provo worked 46 hours.Social security taxes are 6.2 percent,Medicare taxes are 1.45 percent,$50 is withheld for federal income taxes,$12 is withheld for state income taxes,and $15 is withheld for medical insurance.In addition,Provo's employer must pay social security taxes of 6.2 percent,Medicare taxes of 1.45 percent,state unemployment taxes of 5.4 percent,and federal unemployment taxes of .8 percent.Calculate (a)Provo's gross earnings,(b)Provo's take-home pay,(c)the employer's payroll taxes expense,and (d)the total cost of employing Provo for the week.Round all amounts to the nearest penny.

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Definitions:

Bond Discount

The difference between the face value of a bond and its selling price, when the bond is sold for less than its face value.

Straight-Line Method

A depreciation method where an asset's cost is uniformly allocated over its useful life, resulting in equal depreciation expenses each accounting period.

Double-Declining-Balance

An accelerated method of depreciation which doubles the rate at which an asset’s book value depreciates compared to traditional straight-line depreciation, resulting in larger deductions in the early years of an asset’s life.

Market Rate

The prevailing interest rate available in the open market, often influencing or benchmarking loan and savings rates.