How should bi-weekly wages be converted to annual income?

Prepare for the Tax Credit Specialist Exam with detailed flashcards and multiple choice questions complete with hints and explanations. Ace your exam successfully!

To determine how to convert bi-weekly wages to annual income, one must consider the frequency of pay periods and the total number of pay periods in a year. Bi-weekly wages mean that an employee is paid every two weeks. Since there are 52 weeks in a year, dividing that by 2 indicates that there are 26 bi-weekly pay periods in a year.

Therefore, to convert bi-weekly wages to annual income, you take the bi-weekly wage and multiply it by 26. This calculation accounts for all the pay periods throughout the year.

Other choices present incorrect multipliers for calculating annual income based on bi-weekly earnings. For instance, multiplying by 24 would roughly correspond to semi-monthly wages, where employees are paid twice a month, resulting in 24 pay periods. Similarly, multiplying by 52 would indicate weekly wages rather than bi-weekly, and multiplying by 36 does not relate to any standard payroll period and is not a valid conversion for annual income.

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