Problem:
You asked the employees of Financial Outsourcing , Inc, to provide some sample informational questions to put on the FAQ ( Frequently Asked Questions ) page within the company web site. These are the questions they supplied:
1. Sally worked 48 hours this week. Her overtime rate is 1.5 times the regular rate. When calculating gross pay with overtime, there are two options:
( total regular hours X hourly rate ) + ( overtime hours X overtime rate ) = gross pay, OR
( total number of hours worked X the hourly rate) + ( hours over 40 X 0.5 the hourly rate)
Most businesses prefer to use the first method to calculate gross pay . Discuss the reasons for this preference.
2. Many people think that if an increase in earnings moves their salary to a higher tax bracket , their entire salary will be taxed at the higher rate. Is this true? Give an example to justify your answer.