To determine Chin's new monthly net pay after reducing his federal income tax deduction from 12% to 11%, we need to follow these steps:
1. Calculate the new federal income tax deduction:
- Federal income tax percentage is reduced to 11%.
- Chin's monthly gross pay is \$3,500.
[tex]\[
\text{New Federal Income Tax} = 3,500 \times 0.11 = 385
\][/tex]
2. Sum up all deductions including the new federal income tax:
- Federal Income Tax: \$385 (new value)
- State Income Tax: \$95
- Social Security: \$89
- Medicare: \$40
Adding these together,
[tex]\[
\text{Total Deductions} = 385 + 95 + 89 + 40 = 609
\][/tex]
3. Calculate the new monthly net pay:
[tex]\[
\text{New Monthly Net Pay} = 3,500 - 609 = 2891
\][/tex]
Therefore, Chin's new monthly net pay, rounded to the nearest dollar, is \$2891.
