Question
Mr. Nixon and Mr. Ryan are employed by HD Inc., which provides its employees with free parking. If the parking were not available, Mr. Nixon
Mr. Nixon and Mr. Ryan are employed by HD Inc., which provides its employees with free parking. If the parking were not available, Mr. Nixon would pay $23 a month to a city garage. Mr. Ryan uses public transportation to commute. HD offers a complete family medical plan to its employees in which both Mr. Nixon and Mr. Ryan participate. Mr. Nixons family consists of five people, while Mr. Ryan is single. Consequently, Mr. Nixons annual cost of comparable medical insurance would be $18,500, and Mr. Ryans cost would be just $5,450. Assume that Mr. Nixon and Mr. Ryan cannot deduct their annual medical insurance premiums.
a. Mr. Nixon has a 24 percent marginal tax rate. How much additional salary would he have to earn to provide himself with parking and medical insurance? b. Mr. Ryan has a 37 percent marginal tax rate. How much additional salary would he have to earn to provide himself with parking and medical insurance? Complete this question by entering your answers in the tabs below. Required A Required B Mr. Nixon has a 24 percent marginal tax rate. How much additional salary would he have to earn to provide himself with parking and medical insurance? (Do not round intermediate calculations. Round your final answer to the nearest whole dollar amount.) Additional salary Mr. Ryan has a 37 percent marginal tax rate. How much additional salary would he have to earn to provide himself with parking and medical insurance? (Do not round intermediate calculations. Round your final answer to the nearest whole dollar amount.) Additional salary
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