In this exercise, you will compare your monthly outlays to your net income or take-home pay. It is important to spend purposefully, save strategically, invest carefully and give wisely. You want to control your money, rather than having your money control you! Start now. The details of saving, investing, and managing credit card, student loans and other consumer debts are addressed in later exercises. 

First, start by identifying monthly income. For most people, determining monthly take-home pay is easy. Simply look at what is deposited twice monthly in the bank account. For full time students, this can be tricky. Many students are not working full or part time. So let's simplify things.

Let's consider a case study. Assume a newly hired teacher receives $40,000 in annual income. Use this information and the additional information provided below to determine the twice monthly net take-home pay.

Gross annual income

$40,000 a year

Federal income taxes

$940 a year

Social Security and Medicare payroll deductions (7.65%)

$3060 a year

What is your net annual take-home pay? Make sure to factor out taxes and deductions from your gross annual income. (Enter numbers only, no dollar sign, comma, period, or cents. For example, if your answer is $1,000 then enter 1000 as your submission.)

Flag question: Question 2 Question 21 pts What is your monthly net take-home pay? Divide your net pay by 12. (Enter numbers only, no dollar sign, comma, period, or cents.) Flag question: Question 3 Question 31 pts Determine the amount of net take-home pay you receive twice a month or bimonthly. Divide your monthly take-home pay by 2. (Enter numbers only, no dollar sign, comma, period, or cents.) Flag question: Question 4 Question 42 pts Identify three budgetary items that you need to survive and live.

Answer rating: 100% (QA)

To determine the net annual takehome pay we need to subtract the federal income taxes and Social Sec... View the full answer