Calculate Gross Earnings, Gross Taxable Income, CPP, and EI given the information below:
Regular Hours: 80.00
Over Time Hours: 10.00
Hourly Rate: $36.00/hour
Group Life Insurance Taxable Benefit (pensionable, not insurable): $25.25
Paid Semi-monthly
Birthdate: December 1, 1964
YTD CPP: $425.89
YTD EI: $230.67
Use 2022 rates of Manitoba
Accepted Solution
A:
Answer
Based on the given information, we can calculate the following:
Gross Earnings:
The regular pay for 80 hours at an hourly rate of $36.00 is $2,880.00. The overtime pay for 10 hours at a rate of 1.5 times the regular rate is $540.00. Therefore, the gross earnings are $2,880.00 + $540.00 = $3,420.00.
Gross Taxable Income:
The gross taxable income is the gross earnings minus any non-taxable benefits. In this case, the only non-taxable benefit is the group life insurance taxable benefit of $25.25. Therefore, the gross taxable income is $3,420.00 - $25.25 = $3,394.75.
CPP:
The CPP contribution rate for 2022 is 5.45% on earnings between $3,500 and $61,600, up to a maximum contribution of $3,166.45. Therefore, the CPP contribution for this pay period is:
CPP=min[(Gross\Taxable\Income\times CPP\rate),(Maximum\CPP\contribution-YTD\CPP\contributions)]
Substituting the given values, we get:
CPP=min[(3,394.75\times 0.0545),(3,166.45-425.89)]\approx 163.54
Therefore, the CPP contribution for this pay period is approximately $163.54.
EI:
The EI contribution rate for 2022 is 1.58% on earnings up to a maximum of $56,300, up to a maximum contribution of $889.54. Therefore, the EI contribution for this pay period is:
EI=min[(Gross\Taxable\Income\times EI\rate),(Maximum\EI\contribution-YTD\EI\contributions)]
Substituting the given values, we get:
EI=min[(3,394.75\times 0.0158),(889.54-230.67)]\approx 50.68
Therefore, the EI contribution for this pay period is approximately $50.68.
Note that the calculations assume that the employee has no other deductions or credits. The actual amounts may differ depending on the specific circumstances of the employee.