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Marc and Mikkel are married and earned salaries this year of $64,000 and $12,000, respectively. In addition to their salaries, they received interest of $350 from municipal bonds and $500 from corporate bonds. Marc contributed $2,500 to a traditional individual retirement account, and Marc paid alimony to a prior spouse in the amount of $1,500 (under a divorce decree effective June 1, 2006). Marc and Mikkel have a 10-year-old adopted son, Mason, who lived with them throughout the entire year. Thus, Marc and Mikkel are allowed to claim a $2,000 child tax credit for Mason. Marc and Mikkel paid $6,000 of expenditures that qualify as itemized deductions (no charitable contributions), and they had a total of $2,500 in federal income taxes withheld from their paychecks during the year. 1. What is Marc and Mikkel's gross income? 2. What is Marc and Mikkel's adjusted gross income? 3. What is the total amount of Marc and Mikkel's deductions from AGI? 4. What is Marc and Mikkel's taxable income? 5. What is Marc and Mikkel's taxes payable or refund due for the year?

Marc and Mikkel are married and earned salaries this year of $64,000 and $12,000, respectively. In addition to their salaries, they received interest of $350 from municipal bonds and $500 from corporate bonds. Marc contributed $2,500 to a traditional individual retirement account, and Marc paid alimony to a prior spouse in the amount of $1,500 (under a divorce decree effective June 1, 2006). Marc and Mikkel have a 10-year-old adopted son, Mason, who lived with them throughout the entire year. Thus, Marc and Mikkel are allowed to claim a $2,000 child tax credit for Mason. Marc and Mikkel paid $6,000 of expenditures that qualify as itemized deductions (no charitable contributions), and they had a total of $2,500 in federal income taxes withheld from their paychecks during the year. 1. What is Marc and Mikkel's gross income? 2. What is Marc and Mikkel's adjusted gross income? 3. What is the total amount of Marc and Mikkel's deductions from AGI? 4. What is Marc and Mikkel's taxable income? 5. What is Marc and Mikkel's taxes payable or refund due for the year?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Marc and Mikkel are married and earned salaries this year of $64,000 and $12,000, respectively. In addition to their salaries, they received interest of $350 from municipal bonds and $500 from corporate bonds. Marc contributed $2,500 to a traditional individual retirement account, and Marc paid alimony to a prior spouse in the amount of $1,500 (under a divorce decree effective June 1, 2006). Marc and Mikkel have a 10-year-old adopted son, Mason, who lived with them throughout the entire year. Thus, Marc and Mikkel are allowed to claim a $2,000 child tax credit for Mason. Marc and Mikkel paid $6,000 of expenditures that qualify as itemized deductions (no charitable contributions), and they had a total of $2,500 in federal income taxes withheld from their paychecks during the year. 1. What is Marc and Mikkel's gross income? 2. What is Marc and Mikkel's adjusted gross income? 3. What is the total amount of Marc and Mikkel's deductions from AGI? 4. What is Marc and Mikkel's taxable income? 5. What is Marc and Mikkel's taxes payable or refund due for the year?
Transcribed Image Text:Marc and Mikkel are married and earned salaries this year of $64,000 and $12,000, respectively. In addition to their salaries, they received interest of $350 from municipal bonds and $500 from corporate bonds. Marc contributed $2,500 to a traditional individual retirement account, and Marc paid alimony to a prior spouse in the amount of $1,500 (under a divorce decree effective June 1, 2006). Marc and Mikkel have a 10-year-old adopted son, Mason, who lived with them throughout the entire year. Thus, Marc and Mikkel are allowed to claim a $2,000 child tax credit for Mason. Marc and Mikkel paid $6,000 of expenditures that qualify as itemized deductions (no charitable contributions), and they had a total of $2,500 in federal income taxes withheld from their paychecks during the year. 1. What is Marc and Mikkel's gross income? 2. What is Marc and Mikkel's adjusted gross income? 3. What is the total amount of Marc and Mikkel's deductions from AGI? 4. What is Marc and Mikkel's taxable income? 5. What is Marc and Mikkel's taxes payable or refund due for the year?
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