Introduction

Have you noticed that your paycheck does not include all of the money that you made? Well actually it does include all of your money, but the company has made deductions that could include local, state, and federal taxes, health benefits, social security, etc. Your hourly wage multiplied by the hours that you work will calculate your gross pay. After your employer subtracts your deductions, this amount is called your net pay. Your net pay should equal the amount of your actual paycheck. Paycheck are processed at a variety of times. Some employers issue paychecks weekly or bi-weekly, and some will issue paychecks monthly. It is important that a person determines their monthly budget and pays all financial obligations on time and schedules payments according to the issuing time of your paychecks.

At the end of the year, employers are required by the federal government to issue a W-2 form that will list the yearly totals for the employee's gross pay and all deductions taken from their gross pay including federal and state taxes. All employers must supply their employees their W-2 form by January 31st.

Lesson Objectives

Following successful completion of this lesson, students will be able to...

  • Explain economic principles and concepts fundamental to entrepreneurship.
    • Examples: goods and services, supply and demand, private enterprise, cost-profit indicators, trends
  • Differentiate among types of employment documents and records.
    • Examples: tax documentation, contract information, personal income, worker's compensation, social security, pay procedures, deductions, net pay, fringe benefits, electronic fund transfers

Enduring Understandings

  • Job readiness skills include not only career-specific skills but also the ability to interpret and complete employment documents.
  • Society needs entrepreneurs. Entrepreneurs need a basic understanding of economic principles.

The above objectives correspond with the Alabama Course of Study: Workforce Essentials COS standards: 15 and 16

This lesson incorporates the following Literacy Standard: R1, R2, R3, R4, R5, R6, R10, W1, W2, W3, W4, W5, and W6