If a worker's gross pay is $750.00, how much is withheld for Medicare tax at a rate of 1.25 percent?

If a worker's gross pay is $750.00, how much is withheld for Medicare tax at a rate of 1.25 percent?

• A. $9.38
• B. $15.00
• C. $7.50
• D. $5.50

Answer: (A)

To determine how much is withheld for Medicare tax from a worker's gross pay, you multiply the gross pay by the Medicare tax rate. In this case, the worker's gross pay is $750.00, and the Medicare tax rate is 1.25 percent (or 0.0125 when converted to a decimal). The calculation proceeds as follows: 1. Convert the percentage to a decimal: 1.25 percent = 0.0125. 2. Multiply the gross pay by the tax rate: $750.00 × 0.0125 = $9.375. Rounding to the nearest cent, the amount withheld for Medicare tax is approximately $9.38. This calculation accurately reflects how to compute the withholding amount based on the gross income and the applicable tax rate, aligning with standard payroll practices.

To determine how much is withheld for Medicare tax from a worker's gross pay, you multiply the gross pay by the Medicare tax rate. In this case, the worker's gross pay is $750.00, and the Medicare tax rate is 1.25 percent (or 0.0125 when converted to a decimal).

The calculation proceeds as follows:

1. Convert the percentage to a decimal: 1.25 percent = 0.0125.

2. Multiply the gross pay by the tax rate: $750.00 × 0.0125 = $9.375.

Rounding to the nearest cent, the amount withheld for Medicare tax is approximately $9.38. This calculation accurately reflects how to compute the withholding amount based on the gross income and the applicable tax rate, aligning with standard payroll practices.