Question

determine the total annual fica tax for an annual salary of $38,480. (fica is 7.65%)
a. $294.37
b. $717.96
c. $2,385.76
d. $2,943.72

please select the best answer from the choices provided

○ a
○ b
○ c
○ d

Explanation:

Step1: Recall FICA tax formula

FICA tax = Annual salary × FICA rate. The FICA rate is 7.65% or 0.0765 in decimal.

Step2: Substitute values

Annual salary = $38,480, rate = 0.0765. So, FICA tax = \( 38480 \times 0.0765 \).

Step3: Calculate the product

\( 38480 \times 0.0765 = 38480 \times \frac{765}{10000} = \frac{38480 \times 765}{10000} \).
First, calculate \( 38480 \times 765 \):
\( 38480 \times 700 = 26,936,000 \)
\( 38480 \times 60 = 2,308,800 \)
\( 38480 \times 5 = 192,400 \)
Sum: \( 26,936,000 + 2,308,800 + 192,400 = 29,437,200 \)
Then divide by 10,000: \( \frac{29,437,200}{10,000} = 2943.72 \)

Answer:

d. $2,943.72