Compute the net pay for Eve Khan and Marn Hart. Assume that they are paid a $2,500 salary biweekly, subject to federal income tax (use the wagebracket method) in Appendix C and FICA taxes, and have no other deductions from their pay. They have a state tax rate of 3 percent. If they choose to participate in the cafeteria plan, the deduction for the pay period is $100; otherwise, there is no deduction for the cafeteria plan. The cafeteria plan qualifies under Section 125. You do not need to complete the number of hours. Additional information for Eve: Box 2 is not checked, and the dependents are under 17.

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Name Eve Khan-no cafeteria plan Eve Khan- cafeteria plan Marn Hart-no cafeteria plan Marn Hart- cafeteria plan Hourly Rate or Filing Period Status Dependents Wage MJ MJ S S 2 <17 2 <17 0 0 Name Eve Khan-no cafeteria plan Eve Khan-cafeteria plan Marn Hart-no cafeteria plan Marn Hart-cafeteria plan 2,500.00 2,500.00 2,500.00 2,500.00 Taxable Wages for Taxable Federal/ Wages for FICA No. of No. of No. of Regular Overtime Holiday Commiss- Gross Cafeteria State Hours Hours Hours ions Earnings Plan W/H Taxable Wages for Taxable Gross Federal/ Wages Earnings State W/H for FICA W/H Tax Social Federal Security Medicare State W/H Tax W/H Tax Net Pay