Math in the Workplace - Numbers & Operations
COMPUTER ARTS, INC.
Software Developers
Office Manager/Bookkeeper
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Job Description: General office operations including telephones, ordering supplies, supervising employees, Accounts Receivable bookkeeping, Accounts Payable, and payroll. |
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Problem:
Our company has a 401(K) Profit Sharing Plan for employees. Employees may defer up to 15% of their salary to the profit sharing plan. This is a great benefit to employees. Not only is the deferral "pre-tax", the company offers a "match" on the deferral.
The 401(K) amount is deducted from the gross payroll before Federal and State taxes are deducted. The company matches $.50 on the dollar up to 3% of salary. Payment for the deferrals and company match must be sent to the Trust each pay period. Their names of six employees, their monthly salary, and their chosen deferral percentage are listed below.
What is the total check amount to the Trust each pay period?
Complete the following table:
| Employee |
Salary |
% Deferral |
Amount |
Match* |
Total |
| Judy |
$1,000 |
15% |
|
|
|
| Tom |
1,200 |
10% |
|
|
|
| Joe |
2,000 |
3% |
|
|
|
| Sue |
900 |
5% |
|
|
|
| Sally |
1,500 |
3% |
|
|
|
| John |
1,750 |
7% |
|
|
|
 COMPUTER ARTS, INC.
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Solution:
Deferral Amount = Salary x % Deferral
Match* Ј 3%(salary).
Example: Judy invests $150/month. The company matches $.50 on the dollar up to .03($1000) or $30. The company will add $15/month to Judy's investment.
Total = Deferral amount plus match amount.
| Employee |
Payroll |
% Deferral |
Amount |
Match* |
Total |
| Judy |
$1,000 |
15% |
$150.00 |
$15.00 |
$165.00 |
| Tom |
1,200 |
10% |
120.00 |
18.00 |
138.00 |
| Joe |
2,000 |
3% |
60.00 |
30.00 |
90.00 |
| Sue |
900 |
5% |
45.00 |
13.50 |
58.50 |
| Sally |
1,500 |
3% |
45.00 |
22.50 |
67.50 |
| John |
1,750 |
7% |
122.50 |
26.25 |
148.75 |
| Total check to trust: |
$667.75 |