Dr. Kelsey Olson is a chiropractor with an office in Lincoln City. She pays the
following weekly salaries to her three employees:
Employee
Assistant
Office Manager
Receptionist
Weekly Gross Pay
$975.00
800.00
625.00
Remember that the Social Security tax rate is 6.2% of the first $97,500 earned and the
Medicare tax rate is 1.45% of all earnings.
1. The assistant's biweekly health insurance premium is $84.00.
Dr. Olson pays 80% of it and the assistant pays 20%. How much
is withheld from each of the assistant's biweekly paychecks
for health insurance?
2. The state income tax is 3%. How much does the office manager
pay in state taxes every two weeks?
3. How much is withheld for Medicare each week for all three of
Dr. Olson's employees?
4. Dr. Olson's receptionist will receive a 5% raise in June.
How much will be withheld each two weeks for Social
Security after the raise?
$16.80
Chapter 2 Mathematics for Business and Personal Finance