Which of the following is the correct sequence for computing net pay?
A)Compute gross pay then deduct withholding and add FICA taxes to obtain net pay.
B)Compute gross pay,compute FICA,deduct pre-tax amounts,and deduct taxes.
C)Compute gross pay,deduct taxes,and add voluntary deductions.
D)Compute gross pay,deduct pre-tax amounts,compute FICA,deduct taxes,and deduct post-tax amounts.

Question

Quizplus · Accepted Answer

The sequence for computing net pay is to first compute gross pay, then deduct any pre-tax amounts such as contributions to a retirement plan or health insurance. Next, compute FICA taxes and deduct them from the gross pay. Then, deduct any applicable taxes such as federal and state income tax. Finally, deduct any post-tax deductions such as voluntary contributions to a charity or savings account. Therefore, option D is the correct sequence.

Which of the Following Is the Correct Sequence for Computing