Mary Jarvis is a single individual who is working on filing her tax return for the previous year. She has assembled the following relevant information: She received $100,000 in salary. She received $20,000 of dividend income. She received $4,100 of interest income on Home Depot bonds. She received $24,500 from the sale of Disney stock that was purchased 2 years prior to the sale at a cost of $6,900. She received $15,000 from the sale of Google stock that was purchased 6 months prior to the sale at a cost of $7,700. Mary receives one exemption ($4,000), and she has allowable itemized deductions of $7,500. These amounts will be deducted from her gross income to determine her taxable income. Assume that her tax rates are based on Table 3.5. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below. a) What is Mary's federal tax liability? Round your answer to the nearest cent. Do not round intermediate calculations. c) What is her average tax rate? Round your answer to 2 decimal places.
Mary Jarvis is a single individual who is working on filing her tax return for the previous year. She has assembled the following relevant information: She received $100,000 in salary. She received $20,000 of dividend income. She received $4,100 of interest income on Home Depot bonds. She received $24,500 from the sale of Disney stock that was purchased 2 years prior to the sale at a cost of $6,900. She received $15,000 from the sale of Google stock that was purchased 6 months prior to the sale at a cost of $7,700. Mary receives one exemption ($4,000), and she has allowable itemized deductions of $7,500. These amounts will be deducted from her gross income to determine her taxable income. Assume that her tax rates are based on Table 3.5. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below. a) What is Mary's federal tax liability? Round your answer to the nearest cent. Do not round intermediate calculations. c) What is her average tax rate? Round your answer to 2 decimal places.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Mary Jarvis is a single individual who is working on filing her tax return for the previous year. She has assembled the following relevant information:
- She received $100,000 in salary.
- She received $20,000 of dividend income.
- She received $4,100 of interest income on Home Depot bonds.
- She received $24,500 from the sale of Disney stock that was purchased 2 years prior to the sale at a cost of $6,900.
- She received $15,000 from the sale of Google stock that was purchased 6 months prior to the sale at a cost of $7,700.
- Mary receives one exemption ($4,000), and she has allowable itemized deductions of $7,500. These amounts will be deducted from her gross income to determine her taxable income.
Assume that her tax rates are based on Table 3.5. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below.
a) What is Mary's federal tax liability? Round your answer to the nearest cent. Do not round intermediate calculations.
c) What is her average tax rate? Round your answer to 2 decimal places.
Transcribed Image Text:Table 3.5 2015 Individual Tax Rates
Single Individuals
You Pay This
Amount on the
Base of the Bracket
Plus This Percentage
on the Excess over the
Base (Marginal Rate)
10.0%
Average Tax
Rate at
If Your Taxable
Income Is
Up to S9,225
$9,225-S37,450
S37,450-S90,750
Top of Bracket
10.0%
922.50
5,156.25
18,481.25
46,075.25
119,401.25
119,996.25
15.0
13.8
25.0
20.4
$90,750-S189,750
S189,750-S411,500
$411,500-SS413,200
Over $413,200
28.0
24.3
33.0
29.0
35.0
29.0
39.6
39.6
Married Couples Filing Joint Returns
You Pay This
Amount on the
Base of the Bracket
Plus This Percentage
on the Excess over the
Base (Marginal Rate)
Average Tax
Rate at
If Your Taxable
Income Is
Up to $18,450
si8,450-S74,900
10.0%
15.0
25.0
Topof Bracket
10.0%
1,845.00
10,312.50
29,387.50
51,577.50
111,324.00
13.8
S74,900-S151,200
19.4
S151,200-S230,450
S230,450-$411,500
$411,500-S464,850
Over $464,850
28.0
22.4
33.0
27.1
35.0
28.0
129,996.50
39.6
39.6
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