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Pepsi [2]
3 years ago
10

Marc, a single taxpayer, earns $100,000 in taxable income and $10,000 in interest from an investment in city of Birmingham Bonds

. Using the U.S. tax rate schedule for year 2018, what is his effective tax rate (rounded)? (Tax rate schedule
Business
1 answer:
Nutka1998 [239]3 years ago
5 0

Answer:

The answer is: Marc´s effective tax rate is 18.29% equivalent to $18,289.50

Explanation:

Marc is a single filer, so his taxable income of $100,000 falls under the fourth tax bracket ($82,501 to $157,500) with a tax rate of 24%. To calculate Marc´s effective tax rate:

Taxes due = $14,089.50 + [24% x ($100,000 - $82,500)]

                  = $14,089.50 + (24% x $17,500)

                  = $14,089.50 + $4,200

                  = $18,289.50

So Marc´s effective tax rate (ETR) = ($18,289.50 / $100,000) x 100 = 18.29%

Note: The $10,000 Marc earned in interest from municipal bonds (City of Birmingham bonds) are tax exempt, so they are not included in these calculations.

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Answer:

$3,544

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6 0
3 years ago
Wimpy Inc. produces and sells a single product. The selling price of the product is $185.00 per unit and its variable cost is $5
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The formula for the calculation is

<u>CM ratio = Unit contribution margin ÷ Unit selling price </u>

The break-even in monthly dollar sales is closest to $578,100

Explanation:

The formula for the calculation is

<u>CM ratio = Unit contribution margin ÷ Unit selling price </u>

<u></u>

<u>Given that </u>

<u>Selling price of the product=</u>$185.00 per unit

variable cost=$55.50 per unit

fixed expense=$404,670 per month

<u></u>

= ($185.00 per unit − $55.50 per unit) ÷ $185.00 per unit

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<u>Dollar sales to break even = Fixed expenses ÷ CM ratio </u>

= $404,670 ÷ 0.70

= $578,100

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