In a biweekly pay period, an employee earns $10.20 per hour with 80 regular hours, 4 overtime hours, and 3 double-time hours, plus a $50 401(k) deferral. What are the federal income taxable wages?

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Multiple Choice

In a biweekly pay period, an employee earns $10.20 per hour with 80 regular hours, 4 overtime hours, and 3 double-time hours, plus a $50 401(k) deferral. What are the federal income taxable wages?

Federal income taxable wages are the gross pay minus pre-tax deductions. Overtime is paid at 1.5 times the regular rate and double-time at 2 times the regular rate, and all of that is included in gross wages before any pre-tax deductions.

Compute the pieces: regular pay is 80 × 10.20 = 816. Overtime pay is 4 × (10.20 × 1.5) = 4 × 15.30 = 61.20. Double-time pay is 3 × (10.20 × 2) = 3 × 20.40 = 61.20. Sum gross wages = 816 + 61.20 + 61.20 = 938.40. Subtract the $50 401(k) deferral: 938.40 − 50 = 888.40.

So, federal income taxable wages are 888.40.

In a biweekly pay period, an employee earns $10.20 per hour with 80 regular hours, 4 overtime hours, and 3 double-time hours, plus a $50 401(k) deferral. What are the federal income taxable wages?

Prepare for the CPP Exam with engaging tests! Use flashcards and multiple-choice questions, complete with hints and explanations. Ace your exam!

In a biweekly pay period, an employee earns $10.20 per hour with 80 regular hours, 4 overtime hours, and 3 double-time hours, plus a $50 401(k) deferral. What are the federal income taxable wages?

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