Good day students welcome to mathgotserved.com

in this clip where going to be going over how to compute net pay let’s start by taking

a look at this scenario and its us follows maria single have an , all salary of 74,000

and is paid biweekly she cleans no allowance in pays federal and state taxes using the

tables below so the table on the left as though federal tax table for 2016 and on the right

here we have a graduated speech income tax people from Medicare and Social Security taxes

are 1.45 and 6.2% respectively her annual medical insurance which accompany pays 60

percent off is $4000 question calculate various number one gross pay two deductions and three

net pay all right with the to start out by calculating the ghouls Pete okay let’s figure

out her gross peep her out. So let’s write that down parts one grows pay

per. In order to compute this will simply take

her annual salary and divided by the number of peep. She has the year okay number of PE periods

all right let’s go ahead and out determining the necessary components that can helus to

calculate her gross pay per. The first part we need is her annual salary

what is Maria’s annual salary is lariat little salary is $74,000 a year so 74,000 how many

peep units to see how it is stated of the problem that Maria is paid biweekly so what

of that mean it means that she’s paid every two weeks okay so for number off pay periods

is the number of weeks a year divided by two which is we have 52 weeks in a year if you

divide that by two armed acutest 20 6P. This is what biweekly means okay right now

we know the number of peep. That she has in her Connell earnings are gross

pay per. Will simply be the quotient of the on all

salary the on will salary of 74,000 divided by number of peep. In the year which is 26 because she’s peep

biweekly if you plug this into the calculator you end up with $2846.15 this is how much

he gets paid every two weeks every two weeks before taxes are deducted okay so her pretax

earnings is 2000 $2084 $2846 in $.15 every two weeks ago hymnbook that now the next thing

we are asked to determine or her deductions can deductions are the dollar figures dollar

figure amounts that are subtracted from her paycheck before she gets her final am next

page okay so what are we going to be looking at here in this problem her deductions are

made up of the following from the problem we can see that it is stated that she piece

federal taxes state tax she Pisan Medicare tax for retirement she pays Social Security

for retirement expenses in the last deduction is medical insurance for unexpected medical

of events or to maintain her health health situation okay so these are the deductions

that will be computing to determine what her deductions are and doubts will ultimately

help us figure out the last question her next K peer. Okay let’s starts with the first one federal

taxes federal taxes to compute hurts federal taxes we’re going to be making use of this

federal tax table this is as of 2016 the first anyone to do is figure out what tax bracket

she falls in these on her earnings of $74,000 a year okay so I like you to direct your attention

to the first column that shows you the Interpol of incomes that could determine what brackets

and earner falls since you earn 74,000 she falls in between 30 7651 and Mikey one 150

so she falls in the third bracket right here so how much is she going to pay she’s going

to pay $5183.75 plus 25% of whatever she earns over 37,650 okay so let’s go ahead and indicates

what’s all our computations are going to be it’s going to be $5183.75 +25% over 37,000

650 okay now let’s go ahead and start by calculating how much she earns over 37,000 650 so amounts

over is going to be her annual salary of 74,000-37,653 carryout the difference you end up with 36,350

now we can computer federal taxes federal tax taxes are going to be the base amount

$5183.75 +25% of this amount over 74,000 now we need to change 25% into the civil how can

we achieve this you simply move the decimal points to places to the left that is equivalent

to divided 25 x 100 that is what percent means so will have 25% of this amount is the same

in a mathematical notation as 0.25 multiplied by the amount 36,350 if you entered is expression

into your calculator just as it is you end up with auto federal tax of $14,271.25 or

what are her federal taxes per P. Let’s figure that out the federal taxes per P. Is simply

her auto federal taxes of 14,271 and $.25 divided by number of pay. She has she’s paid biweekly so that is going

to be 26 if you put that into your calculator you give her federal tax deduction per paycheck

05 48.89 okay this is how much that will be deducted from her paycheck every two weeks

for federal taxes now let’s is best to the second adoption which is state taxes so how

much does he pay for state tax the state taxes for Maria here is of a graduated nature we

are going to calculate her graduated state tax by making use of this graduated state

income people provided for us in the problem as you can see there are going to be two bases

for the taxation 2% for the first 20,000 and then 3% for any dollar figure over 20,000

okay so let’s indicate that you are set up we have two bases here the first bases is

that 2% and the second bases is at 3% okay now let’s start by computing the first bases

so the first bases can be determined by taking the amounts in the first brackets we have

20,000 and then computes in 2% of that dollar figure 2% in decimal form is .02 this can

be accomplished by moving the decimal points to places to the left as we did in the previous

problem of the entities product into your calculator you end up with $400 as the first

bases that she pays for her state taxes now there is a second bases that she has to pay

because he earns over 20,000 so how much this you earn over 20,000 that should be taxed

at the 3% rate to achieve that’s we will calculate the difference between her earnings and the

dollar figure in the first bases which is $20,000 are going to be multiplying this by

the tax rate in the second bases all 3% in decimal form that’s written as .03 now to

carry others difference you’ll get 54,000 you can do that mentally ill with your calculator

or alternatively you can answer this entire expression in your calculator now multiply

that by .03 and you will get $1620 after tax payment for the second bases now what is for

all state tax deduction all state income tax this can be determined by fine in the sum

of the taxes she peas in the two bases so we add $401,620 if we compute the sum we have

$2020 this is how much area pays in taxes every year but home is a CPA per P. Let’s

determing that state tax per P. This can be determined by finding the quotient of her

Arnel income tax and the number of Peter is which is 26 so you simply divide these and

you end up with $77.69 this is how much Maria pays for state taxes every pay period okay

let’s advance to the next deduction which is Medicare tax deduction number three the

Medicare tax as indicated in the problem is the flat percentage rate of 1.45 solutions

going to be taxed at 1.45% of all her earnings so let’s go ahead and carry out the calculations

per Medicare tax is going to be her Arnel earnings of 74,000×1.45 in decimal form this

can be achieved by moving the decimal two places to the left that gives us .0145 if

you enter this product into your calculators you end up with $1073 for her Arnel Medicare

taxes so what will her Medicare tax trip here. Be let’s go ahead and compute that Medicare

tax her pay. Is simply what you get when you divide her

Arnel medical care tax 1073 by the number of PP roots 26 carryout this division with

your calculators you end up with $41.27 this is a dollar figure that is deducted from maria’s

paycheck for Medicare tax now let’s proceed to her fourth deduction and this is the Social

Security tax okay be is on her earnings her Social Security tax will be a 6.2% reads okay

so she is going to be taxed at 6.2% okay right is go ahead and Carol the calculations her

social security tax per year is going to be her on more earnings of 74,000 multiplied

by X .2% in decimal form .062 if you carry others product you calculators you end up

with 4588 for her Social Security taxes per year now let’s figure out how much she pays

for Social Security per P. So were Social Security tax per pay period 2000 have done

in the previous problems is to take her Arnel Social Security earnings of 4000 588 and divided

by the number of all periods in her P. Which is 26 you carry out the division in your calculator

you will get $176.46 this is the amount of deducted from her P check every two weeks

for Social Security now let’s take a look at the fifth and final deduction from maria’s

paycheck in this is her medical insurance cost medical insurance she have the premium

of $4000 by the company pays the company pays 60% of this amounts okay so if Murray is company

pays 60% of her medical insurance every year how much does CP what percentage is her responsibility

area pays the fully percentage full payment 100% minus what the company pays so she is

responsible for the difference which is 40% so she pays 40% of the premium every year

for medical insurance so what is the dollar value of her payment so we can simply calculate

her medical insurance costs right is down for medical insurance cost by taking the premium

amounts which is 4000 and then computes a of 40% of this premium 40% in decimal form

is .4 the care of this product with your calculators your final result will be 1600 for her Arnel

insurance premium so how must a CPA for medical insurance her P. So let’s determing that medical

insurance costs per P. Want to know how much is taken from her paycheck every two weeks

for medical insurance so as you’ve done in previous am parts would just take her out

all medical insurance cost and divide that by the number of people. It okay. Which is 26 and that gives us $61.54 this

is how much I gets deducted from maria’s paycheck every pay period for medical insurance costs

right now let’s go ahead and not calculate the deduction what is her total deduction

going to be sober deductions can be computed by fine in the sum of the following were going

to add her federal taxes plus or state tax plus her Medicare tax plus her Social Security

tax loss her medical insurance okay medical insurance payment okay learning Nold the dollar

figures for each and every one of the adoption so to substitute them inherent compute the

sum okay so her federal taxes is $548.89 per state taxes $77.69 per Medicare tax is $41.27

her Social Security tax is $176.46 and now finally hard medical insurance is $61.54 so

what we’re going to do is some all these figures together would a calculators if you do that

to get her total deduction per pay period every pay check of my hundred $5.85 so this

is the amount I gets deducted from her gross pay per P. Okay let’s take a look at the third

and final home question which is to find her next pay her next pay can be computed by using

the formula gross pay minus the deductions we know what her gross paper. Is L Wilson the will of the deductions are

so always simply going to do is find the difference okay so her next pay is going to be her gross

pay which is $2846.15 minus her deductions which is a total of my hundred $5.85 the compute

the difference you end up with $1940.30 this is how much area gets to take home every two

weeks as her net pay okay thanks so much for taking the time to watch this presentation

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Woaw this guy is good at explaining