ENGR.ECONOMIC ANALYSIS W/DASHBOARD
ENGR.ECONOMIC ANALYSIS W/DASHBOARD
14th Edition
ISBN: 9780190063467
Author: NEWNAN
Publisher: OXF
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Chapter 12A, Problem 1P
To determine

(a)

The federal tax to be paid.

Expert Solution
Check Mark

Answer to Problem 1P

Tax amount is $500.

Explanation of Solution

Given:

Taxable income is $5000.

Concept used:

Tax slab rates for single taxpayers are as follows.

Taxable income over But not over Tax Of the amount over
$0 $8700 10% $0
$8700 $35350 $870+15% $8700
$35350 $85650 $4867.50+25% $35350
$85650 $178650 $17442.50+28% $85650
$178650 $388350 $43482.50+33% $178650
$388350 $112683.50+35% $388350

Table-(1).

Calculation:

Calculate the federal income tax payable from Table-(1).

T=$5000×10%=$500

Here, the tax amount is T.

Conclusion:

Tax amount is $500.

To determine

(b)

The federal tax to be paid.

Expert Solution
Check Mark

Answer to Problem 1P

Tax amount is $2565.

Explanation of Solution

Given:

Taxable income is $20000.

Calculation:

Calculate the federal income tax payable from Table-(1).

T=$870+15%($20000$8700)=$2565.

Conclusion:

Tax amount is $2565.

To determine

(c)

The federal tax to be paid.

Expert Solution
Check Mark

Answer to Problem 1P

Tax amount is $20060.5.

Explanation of Solution

Given:

Taxable income is $95000.

Calculation:

Calculate the federal income tax payable from Table-(1).

T=$17442.50+28%($95000$85650)=$20060.5.

Conclusion:

Tax amount is $20060.5.

To determine

(d)

The federal tax to be paid.

Expert Solution
Check Mark

Answer to Problem 1P

Tax amount is $100028.

Explanation of Solution

Given:

Taxable income is $350,000.

Calculation:

Calculate the federal income tax payable from Table-(1).

T=$43482.50+33%($350,000$178650)=$100028.

Conclusion:

Tax amount is $100028.

To determine

(e)

The federal tax to be paid.

Expert Solution
Check Mark

Answer to Problem 1P

Tax amount is $326761.

Explanation of Solution

Given:

Taxable income is $1million.

Calculation:

Calculate the federal income tax payable from Table-(1).

T=$112683.50+35%($1,000,000$388350)=$326761.

Conclusion:

Tax amount is $326761.

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