1. **State the problem:** Ty has cumulative earnings of $107,600 and is paid $3,000 this week. We need to find the total Social Security tax for this week. 2. **Understand the tax rules:** - Social Security tax rate is 6.2% on earnings up to $110,100. - Medicare tax rate is 1.45% on all earnings. 3. **Calculate taxable Social Security earnings this week:** Ty's cumulative earnings before this week are $107,600. The Social Security wage base limit is $110,100. The maximum earnings subject to Social Security tax this week are: $$110,100 - 107,600 = 2,500$$ Since Ty is paid $3,000 this week but only $2,500 is subject to Social Security tax, only $2,500 is taxed for Social Security. 4. **Calculate Social Security tax for this week:** $$\text{Social Security tax} = 2,500 \times 0.062 = 155$$ 5. **Calculate Medicare tax for this week:** Medicare tax applies to the full $3,000. $$\text{Medicare tax} = 3,000 \times 0.0145 = 43.5$$ 6. **Calculate total tax for this week:** $$\text{Total tax} = 155 + 43.5 = 198.5$$ 7. **Answer:** The total Social Security tax for this week is $155 (Social Security) plus $43.5 (Medicare), totaling $198.5. Among the options given, the Social Security tax portion is $155, which matches option 4. --- **Question 10:** A merit rating system for SUTA means that the employer's FUTA tax rate can change based on their unemployment claims history, potentially increasing or decreasing FUTA taxes. --- **Summary:** - Total Social Security tax for this week (Social Security portion): $155 - Medicare tax for this week: $43.5 - Total combined tax: $198.5 - Correct multiple choice answer for Social Security tax: 4) $155.00