Question

Tammy made $25,000 in taxable income last year.Suppose the income tax rate is 10% for the first S9500 plus 14% for the amount over S9500.How much must Tammy pay in income tax for last year?

Answer 1

The taxable income Tammy made last year was $25,000.

For the first $9,500, the income tax rate is 10%. That is;

$\frac{10}{100}\times9500=950$

Also, 14% for amount over $9,500. That is;

$\begin{gathered} 25000-9500=15500 \\ \frac{14}{100}\times15500=2170 \end{gathered}$

Thus, the total income tax Tammy paid last year was;

$950+2170=3120$

CORRECT ANSWER: $3,120