Fiona earns a gross wage of €1550 every fortnight. She pays income tax at the rate of 20% on the first €1300 she earns and 40% on the remainder. She has tax credits of €162 per fortnight. Find how much income tax she pays per fortnight. Each fortnight, Fiona also pays USC on her gross wage. The rates are: 1% on the first €462 she earns, 3% on the next €214, and 5.5% on the balance. Find the total amount of USC she pays each fortnight. Fiona pays PRSI amounting to €18 each fortnight. Find the sum of her fortnightly deductions. Write the sum of her fortnightly deductions as a percentage of her gross wage. Give your answer correct to one decimal place.

Leaving Cert Mathematics Financial Maths: Fiona earns a gross wage of €155

Fiona earns a gross wage of €1550 every fortnight - Leaving Cert Mathematics - Question Q6 - 2016

Question Q6

Fiona earns a gross wage of €1550 every fortnight. She pays income tax at the rate of 20% on the first €1300 she earns and 40% on the remainder. She has tax credits ... show full transcript

Worked Solution & Example Answer:Fiona earns a gross wage of €1550 every fortnight - Leaving Cert Mathematics - Question Q6 - 2016

Step 1

Find how much income tax she pays per fortnight.

96%

114 rated

Answer

Calculate the income tax on the first €1300:

20 ext{% of }€1300 = 0.20 imes 1300 = €260
1. Calculate the remaining amount:
€1550 - €1300 = €250
1. Calculate income tax on the remaining €250:
40 ext{% of }€250 = 0.40 imes 250 = €100
1. Total income tax before credits:
€260 + €100 = €360
1. Subtract tax credits:
€360 - €162 = €198

Hence, Fiona pays €198 in income tax every fortnight.

Step 2

Find the total amount of USC she pays each fortnight.

99%

104 rated

Answer

Calculate USC on the first €462:

1 ext{% of }€462 = 0.01 imes 462 = €4.62
1. Calculate USC on the next €214:
3 ext{% of }€214 = 0.03 imes 214 = €6.42
1. Calculate the remaining amount:
€1550 - €462 - €214 = €874
1. Calculate USC on the remaining €874:
5.5 ext{% of }€874 = 0.055 imes 874 = €48.07
1. Total USC:
€4.62 + €6.42 + €48.07 = €59.11

Hence, Fiona pays €59.11 in USC every fortnight.

Step 3

Find the sum of her fortnightly deductions.

96%

101 rated

Answer

Add up the deductions:

Income Tax: €198 USC: €59.11 PRSI: €18

Total deductions:

€198 + €59.11 + €18 = €275.11

Therefore, the sum of her fortnightly deductions is €275.11.

Step 4

Write the sum of her fortnightly deductions as a percentage of her gross wage.

98%

120 rated

Answer

Calculate the percentage:

2 ext{. Perform the calculation:}

rac{275.11}{1550} imes 100 = 17.7 ext{%}

Therefore, her fortnightly deductions as a percentage of her gross wage is 17.7%.

Fiona earns a gross wage of €1550 every fortnight - Leaving Cert Mathematics - Question Q6 - 2016

Worked Solution & Example Answer:Fiona earns a gross wage of €1550 every fortnight - Leaving Cert Mathematics - Question Q6 - 2016

Find how much income tax she pays per fortnight.

Find the total amount of USC she pays each fortnight.

Find the sum of her fortnightly deductions.

Write the sum of her fortnightly deductions as a percentage of her gross wage.

Join the Leaving Cert students using SimpleStudy...