In December,2010,Bob Cratchit worked for Scrooge & Marley and earned $1,000.Federal income tax withholding is 10%.The FICA rate is 6.2% and the Medicare tax is 1.45%.How much cash will Scrooge & Marley pay the government for FICA because of Bob's December earnings?
A)$62.00
B)$124.00
C)$14.50
D)$29.00

Question

Quizplus · Accepted Answer

FICA taxes include both social security (6.2%) and medicare (1.45%) taxes. Therefore, the total FICA tax rate is 7.65%. Bob's December earnings of $1,000 would result in FICA taxes of $76.50 ($1,000 x 0.0765). Scrooge & Marley would be responsible for paying half of this amount, or $38.25.

In December,2010,Bob Cratchit Worked for Scrooge & Marley and Earned