vincent earns $65,000 per year, receives 10 days pto, 8% retirement matching, and receives 70% employer…
vincent earns $65,000 per year, receives 10 days pto, 8% retirement matching, and receives 70% employer - subsidized health insurance which totals $10,000. calculate the benefit rate.\n\n|employee benefits| |\n|--|--|\n|health insurance|70%|\n|fica|7.65%|\n|paid vacation (pto)|10 days|\n|retirement matching|8%|\n\nround to the nearest percentage point.
Answer
Explanation:
Step1: Calculate health insurance benefit amount
The total health - insurance cost is $10000$ and the employer subsidizes 70%, so the health - insurance benefit amount is $0.7\times10000 = 7000$.
Step2: Calculate retirement - matching benefit amount
The retirement - matching rate is 8% of the annual salary. The annual salary is $65000$, so the retirement - matching benefit amount is $0.08\times65000=5200$.
Step3: Calculate PTO value (assuming a 200 - workday year)
If there are 200 workdays in a year and Vincent gets 10 days of PTO, the PTO value as a fraction of the salary is $\frac{10}{200}=0.05$. The PTO benefit amount is $0.05\times65000 = 3250$.
Step4: Calculate total benefits
The total benefits are the sum of health - insurance, retirement - matching, and PTO benefits. So, $7000 + 5200+3250=15450$.
Step5: Calculate FICA amount
The FICA rate is 7.65% of the salary, so the FICA amount is $0.0765\times65000 = 4972.5$. But FICA is not an employer - provided benefit, so we don't include it in the benefit calculation.
Step6: Calculate benefit rate
The benefit rate is $\frac{\text{Total Benefits}}{\text{Annual Salary}}\times100%=\frac{15450}{65000}\times100%\approx23.77%$. Rounding to the nearest percentage point, we get 24%.
Answer:
24%