Answer :
To determine the correct answer about Kim's taxes payable with a taxable income of [tex]$72,000, we need to apply the given tax brackets step by step.
1. First Bracket:
- Taxable amount: $[/tex]0 to [tex]$9,875
- Tax rate: 10%
- Calculation: $[/tex]9,875 \times 0.10 = \[tex]$987.50$[/tex]
2. Second Bracket:
- Taxable amount: [tex]$9,876 to $[/tex]40,125
- Tax rate: 12%
- Calculation: [tex]\((\$40,125 - \$9,875) \times 0.12 = \$30,250 \times 0.12 = \$3,630.00$ 3. Third Bracket: - Taxable amount: $40,126 to $72,000 - Tax rate: 22% - Calculation: \((\$72,000 - \$40,125) \times 0.22 = \$31,875 \times 0.22 = \$7,012.50$ Next, we sum up the taxes from each bracket to find the total tax payable: - Total Tax = \$987.50 (first bracket) + \$3,630.00 (second bracket) + \$7,012.50 (third bracket) = \$11,630.00 Now let's evaluate each option based on this total tax amount: - Option A: The actual tax is more than 22% of the taxable income. - Check: \(\frac{\$11,630.00}{\$72,000} \approx 0.1615 \text{ or } 16.15\%.\)[/tex]
- This is not more than 22%.
- Option B: A part of the taxable income is taxed at 12%.
- True: \[tex]$30,250 is taxed at 12%. - Option C: The average tax rate on the taxable income is 10%. - Check: \(\frac{\$[/tex]11,630.00}{\[tex]$72,000} \approx 0.1615 \text{ or } 16.15\%.\) - This is not 10%. - Option D: The tax payable is 22% of the taxable income. - Check: 22% of \$[/tex]72,000 is [tex]\(\$72,000 \times 0.22 = \$15,840\)[/tex].
- The actual tax payable (\[tex]$11,630.00) is not equal to \$[/tex]15,840.
From this analysis, we see that:
B. A part of the taxable income is taxed at 12%.
is the correct statement. Therefore, the correct answer is B.
2. Second Bracket:
- Taxable amount: [tex]$9,876 to $[/tex]40,125
- Tax rate: 12%
- Calculation: [tex]\((\$40,125 - \$9,875) \times 0.12 = \$30,250 \times 0.12 = \$3,630.00$ 3. Third Bracket: - Taxable amount: $40,126 to $72,000 - Tax rate: 22% - Calculation: \((\$72,000 - \$40,125) \times 0.22 = \$31,875 \times 0.22 = \$7,012.50$ Next, we sum up the taxes from each bracket to find the total tax payable: - Total Tax = \$987.50 (first bracket) + \$3,630.00 (second bracket) + \$7,012.50 (third bracket) = \$11,630.00 Now let's evaluate each option based on this total tax amount: - Option A: The actual tax is more than 22% of the taxable income. - Check: \(\frac{\$11,630.00}{\$72,000} \approx 0.1615 \text{ or } 16.15\%.\)[/tex]
- This is not more than 22%.
- Option B: A part of the taxable income is taxed at 12%.
- True: \[tex]$30,250 is taxed at 12%. - Option C: The average tax rate on the taxable income is 10%. - Check: \(\frac{\$[/tex]11,630.00}{\[tex]$72,000} \approx 0.1615 \text{ or } 16.15\%.\) - This is not 10%. - Option D: The tax payable is 22% of the taxable income. - Check: 22% of \$[/tex]72,000 is [tex]\(\$72,000 \times 0.22 = \$15,840\)[/tex].
- The actual tax payable (\[tex]$11,630.00) is not equal to \$[/tex]15,840.
From this analysis, we see that:
B. A part of the taxable income is taxed at 12%.
is the correct statement. Therefore, the correct answer is B.
