Understanding Paychecks
This worksheet helps 8th-grade students understand the components of a paycheck, including gross pay, net pay, deductions, and taxes.
Includes
Standards
Understanding Paychecks
Name:
Date:
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Read each question carefully and answer to the best of your ability. Show your work where applicable.
1. The total amount of money an employee earns before any deductions is called .
2. The amount of money an employee takes home after all deductions are made is called .
3. Money withheld from an employee's paycheck for taxes, insurance, or retirement is known as .
4. FICA stands for Federal Insurance Contributions Act, and it includes taxes for Social Security and .
1. If your gross pay is $800 and your deductions are $150, what is your net pay?
$950
$800
$650
$150
2. Which of the following is NOT typically a mandatory deduction from a paycheck?
Federal Income Tax
State Income Tax
Health Insurance Premiums
Charitable Donations
1. Gross pay is always less than net pay.
True
False
2. Social Security and Medicare taxes are part of FICA.
True
False
1. Sarah earns $15 per hour and works 40 hours a week. Her weekly deductions are $80 for federal taxes, $30 for state taxes, and $20 for health insurance. Calculate her gross pay and net pay for the week.
2. Explain why understanding your paycheck is important for personal financial planning.
Match each term on the left with its definition on the right.
1. Gross Pay
a. Money taken out of a paycheck
2. Net Pay
b. Total earnings before deductions
3. Deductions
c. Earnings after deductions