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Use the marginal tax rate chart to answer the question.

Marginal Tax Rate Chart
\begin{tabular}{|l|l|}
\hline \multicolumn{1}{|c|}{ Tax Bracket } & Marginal Tax Rate \\
\hline[tex]$\$[/tex] 0-\[tex]$ 10,275$[/tex] & [tex]$10 \%$[/tex] \\
\hline[tex]$\$[/tex] 10,276-\[tex]$ 41,175$[/tex] & [tex]$12 \%$[/tex] \\
\hline[tex]$\$[/tex] 41,176-\[tex]$ 89,075$[/tex] & [tex]$22 \%$[/tex] \\
\hline[tex]$\$[/tex] 89,076-\[tex]$ 170,050$[/tex] & [tex]$24 \%$[/tex] \\
\hline[tex]$\$[/tex] 170,051-\[tex]$ 215,950$[/tex] & [tex]$32 \%$[/tex] \\
\hline[tex]$\$[/tex] 215,951-\[tex]$ 539,900$[/tex] & [tex]$35 \%$[/tex] \\
\hline[tex]$\ \textgreater \ \$[/tex] 539,901[tex]$ & $[/tex]37 \%[tex]$ \\
\hline
\end{tabular}

Determine the amount of taxes owed on a taxable income of $[/tex]\[tex]$ 38,520$[/tex].

A. [tex]$\$[/tex] 3,852.00[tex]$
B. $[/tex]\[tex]$ 4,416.90$[/tex]
C. [tex]$\$[/tex] 4,622.40[tex]$
D. $[/tex]\[tex]$ 8,474.40$[/tex]



Answer :

GinnyAnswer
Sure, let's find out the amount of taxes owed on a taxable income of [tex]$38,520 using the marginal tax rate chart step-by-step. 1. Determine taxable income within the first bracket ($[/tex]0 - [tex]$10,275): - Income in this bracket: $[/tex]10,275
- Tax rate: 10%
- Tax for this portion: [tex]$10,275 * 0.10 = $[/tex]1,027.50

2. Determine taxable income within the second bracket ([tex]$10,276 - $[/tex]41,175):
- Income within this bracket: [tex]$38,520 - $[/tex]10,275 = [tex]$28,245 - This income is within the second bracket’s limit. - Tax rate: 12% - Tax for this portion: $[/tex]28,245 * 0.12 = [tex]$3,389.40 3. Adding all the taxes: - Total tax: $[/tex]1,027.50 (first bracket) + [tex]$3,389.40 (second bracket) - Total tax owed: $[/tex]4,416.90

Hence, the amount of taxes owed on a taxable income of [tex]$38,520 is \$[/tex]4,416.90. Thus, the correct option is:

[tex]\[ \$ 4,416.90 \][/tex]

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