Question

Monroe county levies a tax on the value of real property located within the county. The tax equals 3 percent of the property's assessed value up to $2 million plus 1 percent of the value in excess of $2 million.a. Compute the tax on real property valued at $1.3 million.b. Compute the tax on real property valued at $4.5 million.

Answer 1

Answer:

a. $39,000

b. $85,000

Explanation:

The computations are shown below:

a. Tax on real property would be

= Valued of real property × tax rate

= $1,300,000 × 3%

= $39,000

b. Tax on real property would be

= Property's assessed value up  × tax rate + difference of property value  × increased tax rate

= $2,000,000 × 3% + $2,500,000 × 1%

= $60,000 + $25,000

= $85,000