In: Accounting
Problem 1-11
The Tax Formula for Individuals, Filing Status and Tax Computation,
Personal and Dependency Exemptions, The Standard Deduction (LO 1.3,
1.5, 1.6, 1.7)
Frank, age 35, and Joyce, age 34, are married and file a joint income tax return for 2017. Their salaries for the year total $84,600 and they have taxable interest income of $3,900. They have no deductions for adjusted gross income. Their itemized deductions are $12,800. Frank and Joyce do not have any dependents.
Table for the standard deduction
|
a. What is the amount of their adjusted gross
income?
$
b. What is their deduction for personal
exemptions?
$
c. What is the amount of their taxable
income?
$
SOLUTION:-
Given Data:-
Frank, age 35, and Joyce, age 34, are married and file a joint income tax return for 2017
Total=$84,600
Interest Income =$3,900
Deductions =$12,800
Table for the standard deduction:-
|
Account details | Amount ($) |
Salaries | $84600 |
(+) Taxable interest | $ 3900 |
Gross income | $88500 |
( -) Itemized deductions | $12800 |
Total income | $75700 |
(-) Standard deductions | $12700 |
Taxable income | $63000 |
(a) What is the amount of their adjusted gross income=$88500
(b)What is their deduction for personal exemptions=$13000
(c) What is the amount of their taxable income =$63000
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