| Name: ______________________________ | Date: ______________ |
Instructions
- Gross pay is the money you earn before deductions.
- Net pay is the money you take home after deductions.
- Subtract all deductions from gross pay to find net pay.
- Show your calculations and include dollar signs in your answers.
Example: Jordan earns $480 gross pay. Taxes are $72, and other deductions are $28. What is Jordan's net pay? Gross pay − deductions = net pay.
Answer: $480 − ($72 + $28) = $380 net pay
Part 1: Paycheck Vocabulary
Complete each sentence with the correct financial term.
1. The amount earned before taxes and other deductions is called __________ pay.
2. The amount left after deductions is called __________ pay.
3. Money taken from gross pay for taxes or benefits is called a __________.
4. The document that shows earnings and deductions is a pay__________.
Part 2: Understand the Difference
Choose the best answer for each question.
5. Which amount is usually larger?
| ○ A. Gross pay | ○ B. Net pay |
| ○ C. Tax refund | ○ D. Hourly rate |
6. Which formula finds net pay?
| ○ A. Gross pay + deductions | ○ B. Gross pay − deductions |
| ○ C. Deductions − gross pay | ○ D. Gross pay × deductions |
7. A worker earns $600 gross pay and has $150 in deductions. What is the net pay?
| ○ A. $450 | ○ B. $750 |
| ○ C. $150 | ○ D. $500 |
8. Which is most likely a deduction from a paycheck?
| ○ A. Federal income tax | ○ B. A birthday gift |
| ○ C. A grocery receipt | ○ D. A bus schedule |
Part 3: Read the Paycheck
Calculate each worker's total deductions and net pay.
| Worker | Gross pay | Taxes | Other deductions | Total deductions | Net pay |
|---|---|---|---|---|---|
| Ari | $500 | $80 | $20 | $100 | $400 |
| Bea | $720 | $108 | $32 | ||
| Carlos | $950 | $142 | $58 | ||
| Dina | $1,200 | $180 | $75 | ||
| Eli | $875 | $131 | $44 |
Part 4: First Job Calculations
Solve each paycheck problem and write the answer with its unit.
10. Maya earns $16 per hour and works 20 hours. Her total deductions are $64. What is her net pay? Answer: __________ dollars |
11. Noah earns $14 per hour for 18 hours. Taxes are $35, and insurance is $17. What is his net pay? Answer: __________ dollars |
12. Avery's gross pay is $840. The net pay is $672. How much was deducted? Answer: __________ dollars |
13. Sam's gross pay is $1,000, and deductions total 22% of gross pay. What is Sam's net pay? Answer: __________ dollars |
Part 5: Think Like a Budgeter (optional challenge)
Answer in a complete sentence or show a clear calculation.
14. Why is net pay more useful than gross pay when planning a monthly budget? |
15. A job advertisement says $15 per hour, but the paycheck shows less than $15 per hour after deductions. Is this a mistake? Explain. |
16. A worker's gross pay is $900 and net pay is $765. What percentage of gross pay was deducted? |
Answer Key
| 1. | gross |
| 2. | net |
| 3. | deduction |
| 4. | stub |
| 5. | A (Gross pay) |
| 6. | B (Gross pay − deductions) |
| 7. | A ($450) |
| 8. | A (Federal income tax) |
| 9a. | Bea · $720 · $108 · $32 · $140 · $580 |
| 9b. | Carlos · $950 · $142 · $58 · $200 · $750 |
| 9c. | Dina · $1,200 · $180 · $75 · $255 · $945 |
| 9d. | Eli · $875 · $131 · $44 · $175 · $700 |
| 10. | 256 dollars |
| 11. | 200 dollars |
| 12. | 168 dollars |
| 13. | 780 dollars |
| 14. | Net pay is more useful because it is the amount actually available to spend or save after deductions. |
| 15. | Not necessarily. The advertised rate is gross hourly pay, while the amount received after deductions is net pay. |
| 16. | 15%, because $900 − $765 = $135 and $135 ÷ $900 = 0.15. |