Find the Tax in the Following Application Problems

question 97

Multiple Choice

Find the tax in the following application problems. Use $4050 for each personal deduction, a standard deduction of $6300 for single taxpayers, $12,600 for married taxpayers filing jointly, $6300 for married taxpayers filing separately, and $9300 for head of household and the tax rate schedule.
-The Greenwoods had an adjusted gross income of $57,492 last year. They had deductions of $1,095 for state income tax, $4,205 for property tax, $5,320 in mortgage interest, and $2,261 in contributions. The Greenwoods claim four exemptions and file a joint return.

• A)$3,813.80
• B)$5,841.65
• C)$4,902.75
• D)$3,334.15

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Definitions:

OPEC

The Organization of Petroleum Exporting Countries, an intergovernmental organization of oil-producing countries that aims to manage the supply of oil to stabilize prices and ensure steady earnings.

Price Ceiling

A government-imposed maximum price that can be charged for a good or service, intended to protect consumers from high prices.

Market Demand

The aggregate of a good or service that each consumer in a market is eager and qualified to purchase at differing prices.

Binding

A situation where a restriction, such as a price ceiling or floor, actually affects the market outcome because it is set above or below the equilibrium price.