Question
Arabella Cunningham is 24 years old and single, lives in an apartment, and has no dependents. Last year she earned $36,500 as a sales representative
Arabella Cunningham is 24 years old and single, lives in an apartment, and has no dependents. Last year she earned $36,500 as a sales representative for Planning Associates; $2,555 of her wages was withheld for federal income taxes. In addition, she had interest income of $122.
The standard deduction in 2018 was $12,000 for single. The appropriate tax rate schedule is shown below:
EXHIBIT 3.3Sample Tax Rate Schedules | |||||||||||||||||||
Tax rates levied on personal income vary with the amount of reported taxable income and the taxpayer's filing status. | |||||||||||||||||||
|
a. Estimate her taxable income. $
b. Estimate her tax liability. Round the answer to the nearest cent. Use unrounded values in later calculations. (Hint: Use the tax rate schedules given in Exhibit 3.3 to determine her tax liability.) $
c. Estimate her tax refund or tax owed. Enter tax owed, if any, as negative amount. Round the answer to the nearest cent. $
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started