Question
In: Economics
katie had a before-tax income of $40,000 and paid taxes of $6,000. Ramesh had a before...
katie had a before-tax income of $40,000 and paid taxes of $6,000. Ramesh had a before tax income of $35,000 and paid taxes of $5,250. Based on this information, the tax system is .....
a.regressive for all income levels below $40,000
b. proportional
c. progressive
d. based on the benefits-received principle
e. regressive for income levels between $35,000 and $40,000
Solutions
Expert Solution
As Katie has a higher income and she is paying a higher tax than Ramesh, i.e. as the income is increasing the tx is increasing we can say that the tax is progressive.
The answer is "C".
Rahul Sunny answered 2 years agoRelated Solutions
Data on before-tax income, taxes paid, and consumption spending for the Simpson family in various years...
Data on before-tax income, taxes paid, and consumption spending
for the Simpson family in various years are given below.
Before-tax
income ($)
Taxes
paid ($)
Consumption
spending ($)
25,000
3,000
20,000
27,000
3,500
21,350
28,000
3,700
22,070
30,000
4,000
23,600
a. Graph the Simpsons’ consumption function and find their
household’s marginal propensity to consume.
Instructions: On the graph below, use the line
tool provided. Click and drag your mouse to draw a diagonal,
straight line by using the precise coordinates...
) Marin Corporation had the following tax information. Year Taxable Income Tax Rate Taxes Paid 2015...
) Marin Corporation had the following tax
information.
Year
Taxable Income
Tax Rate
Taxes Paid
2015
$303,000
36%
$109,080
2016
322,000
31%
99,820
2017
395,000
31%
122,450
In 2018, Marin suffered a net operating loss of $812,000, which it
elected to carry back. The 2018 enacted tax rate is 32% (and this
rate is expected to be in use for the foreseeable future).
Prepare Marin’s entry to record the effect of the loss carryback
(and carryforward).
Zekany Corporation would have had identical income before taxes on both its income tax returns and...
Zekany Corporation would have had identical income before taxes
on both its income tax returns and income statements for the years
2018 through 2021 except for differences in depreciation on an
operational asset. The asset is purchased in 2018 at a cost of
$120,000 and is depreciated fully for income tax purposes in 2018.
The operational asset has a four-year life and no residual value.
The straight-line method is used for financial reporting purposes.
Pretax accounting income amounts for each...
Zekany Corporation would have had identical income before taxes on both its income tax returns and...
Zekany Corporation would have had identical income before taxes
on both its income tax returns and income statements for the years
2021 through 2024 except for differences in depreciation on an
operational asset. The asset cost $270,000 and is depreciated for
income tax purposes in the following amounts: 2021 $ 89,100 2022
118,800 2023 40,500 2024 21,600 The operational asset has a
four-year life and no residual value. The straight-line method is
used for financial reporting purposes. Income amounts before...
Zekany Corporation would have had identical income before taxes on both its income tax returns and...
Zekany Corporation would have had identical income before taxes
on both its income tax returns and income statements for the years
2018 through 2021 except for differences in depreciation on an
operational asset. The asset cost $200,000 and is depreciated for
income tax purposes in the following amounts: 2018 $ 66,000 2019
88,000 2020 30,000 2021 16,000 The operational asset has a
four-year life and no residual value. The straight-line method is
used for financial reporting purposes. Income amounts before...
Zekany Corporation would have had identical income before taxes on both its income tax returns and...
Zekany Corporation would have had identical income before taxes
on both its income tax returns and income statements for the years
2018 through 2021 except for differences in depreciation on an
operational asset. The asset cost $280,000 and is depreciated for
income tax purposes in the following amounts:
2018 $ 92,400
2019 123,200
2020 42,000
2021 22,400
The operational asset has a four-year life and no residual
value. The straight-line method is used for financial reporting
purposes. Income amounts before...
Zekany Corporation would have had identical income before taxes on both its income tax returns and...
Zekany Corporation would have had identical income before taxes
on both its income tax returns and income statements for the years
2016 through 2019 except for differences in depreciation on an
operational asset. The asset cost $300,000 and is depreciated for
income tax purposes in the following amounts:
2016
$
99,000
2017
132,000
2018
45,000
2019
24,000
The operational asset has a four-year life and no residual
value. The straight-line method is used for financial reporting
purposes.
Income...
ekany Corporation would have had identical income before taxes on both its income tax returns and...
ekany Corporation would have had identical income before taxes
on both its income tax returns and income statements for the years
2021 through 2024 except for differences in depreciation on an
operational asset. The asset cost $140,000 and is depreciated for
income tax purposes in the following amounts:
2021
$
46,200
2022
61,600
2023
21,000
2024
11,200
The operational asset has a four-year life and no residual value.
The straight-line method is used for financial reporting
purposes.
Income amounts before...
Zekany Corporation would have had identical income before taxes on both its income tax returns and...
Zekany Corporation would have had identical income before taxes
on both its income tax returns and income statements for the years
2018 through 2021 except for differences in depreciation on an
operational asset. The asset cost $210,000 and is depreciated for
income tax purposes in the following amounts
: 2018 $ 69,300
2019 92,400
2020 31,500
2021 16,800
The operational asset has a four-year life and no residual
value. The straight-line method is used for financial reporting
purposes. Income amounts...
Zekany Corporation would have had identical income before taxes on both its income tax returns and...
Zekany Corporation would have had identical income before taxes
on both its income tax returns and income statements for the years
2021 through 2024 except for differences in depreciation on an
operational asset. The asset cost $280,000 and is depreciated for
income tax purposes in the following amounts:
2021
$
92,400
2022
123,200
2023
42,000
2024
22,400
The operational asset has a four-year life and no residual value.
The straight-line method is used for financial reporting
purposes.
Income amounts before...
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