Alan Johnson works for CAT Commercial Builders, Inc. His pay rate is $14.00 per hour and he receives overtime pay at one and one-half times his regular hourly rate for any hours worked beyond 40 in a week. During the pay period ended December 31, 20X1, Alan worked 48 hours. Alan is married and claims three withholding allowances on his W-4 form. His cumulative earnings prior to this pay period total $29,260. Allan’s wages are subject to the following deductions:
1. Social security tax at 6.2 percent
2. Medicare tax at 1.45 percent
3. Federal income tax (use the withholding table shown in Figure 10.2B)
4. Health insurance premiums, $150
5. Credit Union savings, $25

INSTRUCTIONS
1. Compute Alan’s regular, overtime premium earnings, gross, and net pay.
2. Assuming the weekly payroll has been recorded, journalize the payment of his wages for the week ended December 31, 20X1. Use journal page 18.

Analyze: 

Based on Alan’s cumulative earnings through December 31, how much overtime pay did he earn this year?