Sierra Sports employs several people, but we will look at one specific employee for this example. Billie Sanders works for Sierra Sports and earns a salary each month of $16,000.

• Withholdings for federal taxes equal $2,000
• Withholdings of state income taxes equal $500.
• FICA Social Security is taxed at the 6.2% rate
• FICA Medicare is taxed at the 1.45% rate.
• Sierra Sports receives the FUTA credit and is only taxed at the rate of 0.6% (as a decimal this is .006)
• SUTA taxes are $300
• Billie has voluntary deductions for health insurance and a 401(k) retirement contribution.
  • She is responsible for 40% of her $2,000 healthcare insurance premium;
  • Sierra Sports pays the remaining 60% of the health insurance premium(as explained in the employer payroll).
  • Billie's 401(k) contributions total $400.

Using the information above, calculate the following:

1) Billie's gross pay

2) Billie's net pay

3) Billie's portion of health insurance

4) Employer's payroll tax expense

5) Employer's portion of health insurance

Please show work and answers.

Answer rating: 100% (QA)

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