Question

tim mogilnitsky is a self - employed researcher. he pays fica at a rate of 12.4% and medicare at a rate of 2.9%. find the dollar amount of these taxes on the annual adjusted earnings of $42,986.35. tims fica tax is $ (round to the nearest cent.)

Explanation:

Step1: Calculate total tax rate

First, find the total tax rate by adding the FICA rate and the Medicare rate. The FICA rate is 12.4% (or 0.124 in decimal) and the Medicare rate is 2.9% (or 0.029 in decimal). So the total tax rate is \(0.124 + 0.029 = 0.153\).

Step2: Calculate tax amount

Now, multiply the annual adjusted earnings by the total tax rate. The annual adjusted earnings are $42,986.35. So the tax amount is LXI0. Let's calculate that: \(42986.35\times0.153 = 42986.35\times(0.1 + 0.05+ 0.003)=4298.635+2149.3175 + 128.95905 = 6576.91155\). Rounding to the nearest cent (two decimal places), we get $6576.91.

Answer:

\(6576.91\)