calculate the social security and medicare tax that would be applied to an annual salary of $235,430. use…

calculate the social security and medicare tax that would be applied to an annual salary of $235,430. use $106,800 for maximum taxable earnings. \n a. social security tax: $1,459.67, medicare tax: $341.37 \n b. social security tax: $14,596.66, medicare tax: $3,413.70 \n c. social security tax: $662.16, medicare tax: $341.37 \n d. social security tax: $6,621.60, medicare tax: $3,413.70 \n please select the best answer from the choices provided

calculate the social security and medicare tax that would be applied to an annual salary of $235,430. use $106,800 for maximum taxable earnings. \n a. social security tax: $1,459.67, medicare tax: $341.37 \n b. social security tax: $14,596.66, medicare tax: $3,413.70 \n c. social security tax: $662.16, medicare tax: $341.37 \n d. social security tax: $6,621.60, medicare tax: $3,413.70 \n please select the best answer from the choices provided

Answer

Explanation:

Step1: Recall Tax Rates

Social Security tax rate is 6.2% (on maximum taxable earnings of $106,800), Medicare tax rate is 1.45% (no earnings cap).

Step2: Calculate Social Security Tax

Social Security tax = ( 106800 \times 0.062 ) = ( 106800 \times \frac{62}{1000} = 6621.60 )? Wait, no, wait: Wait, the maximum taxable earnings is $106,800. Wait, the salary is $235,430, but we use the maximum taxable earnings for Social Security. So Social Security tax: ( 106800 \times 0.062 = 6621.60 )? Wait, no, wait the options: Wait, option c: Social Security tax $662.16? Wait, no, maybe I misread the maximum taxable earnings. Wait the problem says "Use $106,800 for maximum taxable earnings". Wait, 6.2% of 106,800: ( 106800 \times 0.062 = 6621.60 )? No, wait 106800 * 0.062: 106800 * 62/1000 = (106800/1000)62 = 106.862 = 6621.6. But option c is $662.16, option d is $6,621.60. Wait, maybe the tax rate is 0.62? No, Social Security tax rate is 6.2% (0.062). Wait, the annual salary is $235,430, but Social Security is on first $106,800. So Social Security tax: 106800 * 0.062 = 6621.60. Medicare tax: 235430 * 0.0145 = let's calculate that: 235430 * 0.0145. 235430 * 0.01 = 2354.3, 235430 * 0.0045 = 1059.435, total = 2354.3 + 1059.435 = 3413.735 ≈ 3413.70. So Social Security tax: 6621.60, Medicare: 3413.70. Which is option d: Social Security tax: $6,621.60, Medicare tax: $3,413.70. Wait, but let's check the options again:

a. Social Security tax: $1,459.67, Medicare tax: $341.37

b. Social Security tax: $14,596.66, Medicare tax: $3,413.70

c. Social Security tax: $662.16, Medicare tax: $341.37

d. Social Security tax: $6,621.60, Medicare tax: $3,413.70

Ah, I see, I think I miscalculated the decimal. Wait 6.2% is 0.062, but maybe the problem has a typo, or I misread the maximum taxable earnings. Wait, 106,800 * 0.062: 106800 * 0.062 = 6621.60 (which is option d's Social Security tax). Medicare tax: 235430 * 0.0145 = 3413.705 ≈ 3413.70 (option d's Medicare tax). So the correct answer is d.

Answer:

d. Social Security tax: $6,621.60, Medicare tax: $3,413.70