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Select the correct answer.

Sue's taxable income is [tex]\[tex]$30,000[/tex] a year after accounting for deductions. Assuming she does not apply for tax credits, what is the correct way to compute the tax she owes? Use the following tax table.
\begin{tabular}{|c|c|}
\hline Taxable Income & Tax Rate \\
\hline [tex]\$[/tex]0-\[tex]$9,875[/tex] & [tex]10\%[/tex] \\
\hline [tex]\$[/tex]9,876-\[tex]$40,125[/tex] & [tex]12\%[/tex] \\
\hline
\end{tabular}

A. [tex]12\% \times \$[/tex]30,000[/tex]

B. [tex]10\% \times \[tex]$9,875 + 12\% \times (\$[/tex]40,125 - \[tex]$30,000)[/tex]

C. [tex]10\% \times \$[/tex]9,875 + 12\% \times (\[tex]$30,000 - \$[/tex]9,875)[/tex]

D. [tex]12\% \times (\[tex]$40,125 - \$[/tex]30,000)[/tex]

E. [tex]10\% \times \[tex]$9,875 + 12\% \times \$[/tex]30,000[/tex]


Sagot :

Let's determine the correct way to compute the tax Sue owes based on her taxable income of \[tex]$30,000 using the provided tax table. First, notice that her income falls into two tax brackets: 1. The first portion of her income from \$[/tex]0 to \[tex]$9,875 is taxed at 10%. 2. The remaining portion of her income from \$[/tex]9,876 to \[tex]$30,000 is taxed at 12%. We need to calculate the tax for each portion separately and then sum them up. 1. Tax for the first slab (\( \$[/tex]0 - \[tex]$9,875 \)): \[ 10\% \times 9,875 = 0.10 \times 9,875 = 987.5 \] 2. Tax for the second slab (\( \$[/tex]9,876 - \[tex]$30,000 \)): \[ 12\% \times (30,000 - 9,875) = 0.12 \times (30,000 - 9,875) = 0.12 \times 20,125 = 2,415.0 \] Now, we sum the tax amounts from both slabs to get the total tax: \[ 987.5 + 2,415.0 = 3,402.5 \] Given this step-by-step process, the correct calculations fit option C: \[ 10 \% \times \$[/tex] 9,875 + 12 \% \times(\[tex]$ 30,000 - \$[/tex] 9,875)
\]

So, the correct answer is:

C. [tex]$10 \% \times \$[/tex] 9,875 + 12 \% \times(\[tex]$ 30,000-\$[/tex] 9,875)$
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