Question

Amanda works as an industrial designer. Her adjusted gross income (AGI) is $60,000. Her gross pay is reduced by $300 to arrive at this amount. What is this amount of $300 called? A. credit B. expense C. deduction D. tax

Answer 1

C because it is deducting money

Answer 2

Deduction

Step-by-step explanation:

If Amanda's adjusted income is $60,000 after her gross pay is reduced by $300 to arrive at the amount, this means her initial pay is equal to adjusted income + reduction in gross pay i.e

Initial pay = $60,000+$300

Initial gross pay = $60,300

This initial gross pay is reduced by $300 to arrive back at $60,000 and since there is a reduction in the amount by $300 in the gross pay, this amount of $300 reduction is known deduction since deduction means removal of a particular amount of money (which is always a small amount of money compare to the gross) from a gross pay