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Select the correct answer.

\begin{tabular}{|c|c|l|}
\hline
If taxable income is over- & But not over- & \\
\hline
\[tex]$ 0 & \$[/tex] 7,825 & 10 percent of the amount over \[tex]$ 0 \\
\hline
\$[/tex] 7,825 & \[tex]$ 31,850 & \$[/tex] 782.50 plus 15 percent of the amount over \[tex]$ 7,825 \\
\hline
\$[/tex] 31,850 & \[tex]$ 77,100 & \$[/tex] 4,386.25 plus 25 percent of the amount over \[tex]$ 31,850 \\
\hline
\$[/tex] 77,100 & \[tex]$ 160,850 & \$[/tex] 15,698.75 plus 28 percent of the amount over \[tex]$ 77,100 \\
\hline
\$[/tex] 160,850 & \[tex]$ 349,700 & \$[/tex] 39,148.75 plus 33 percent of the amount over \[tex]$ 160,850 \\
\hline
\$[/tex] 349,700 & no limit & \[tex]$ 101,469.25 plus 35 percent of the amount over \$[/tex] 349,700 \\
\hline
\end{tabular}

Use this tax table to find how much tax you need to pay on a taxable income of \[tex]$ 25,000.

A. \$[/tex] 2,576.25
B. \[tex]$ 3,358.75
C. \$[/tex] 5,934.25



Answer :

GinnyAnswer
To determine the tax you need to pay on a taxable income of \[tex]$25,000 using the provided tax table, follow these steps: 1. Identify the correct income bracket: According to the table, the taxable income of \$[/tex]25,000 falls into the bracket that ranges from \[tex]$7,825 to \$[/tex]31,850.

2. Base amount calculation: The base tax for this income bracket is \[tex]$782.50. 3. Excess income calculation: Calculate the excess income over \$[/tex]7,825.
[tex]\[ \text{Excess Income} = \$25,000 - \$7,825 = \$17,175 \][/tex]

4. Excess tax calculation: This excess income is taxed at 15%.
[tex]\[ \text{Excess Tax} = 0.15 \times \$17,175 = \$2,576.25 \][/tex]

5. Total tax calculation: Add the base tax with the excess tax to get the total tax.
[tex]\[ \text{Total Tax} = \$782.50 + \$2,576.25 = \$3,358.75 \][/tex]

Therefore, the amount of tax you need to pay on a taxable income of \[tex]$25,000 is \$[/tex]3,358.75.

The correct answer is:

B. \$3,358.75

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