Question

As of 2015 , farms were taxed at 10 percent for income up to $46,000; at 24 percent for income ranging from $46,000 to $66,000; at 30 percent for taxable income $66,000 to $82,000; at 45 percent for income from $82,000 to $213,000, and so on. Suppose that you have revenues of $164,700 and operating expense of $65,700. How much tax is paid on the first $46,000 of taxable income?

A)$4,600
B)$7,650
C)$4,800
​D)None of the answers are correct

Answer 1

The tax paid on the first $46,000 of taxable income is $4,600.

Step-by-step explanation:

The marginal tax rate refers to the rate at which an additional dollar of income is taxed. In the given tax bracket, the income up to $46,000 is taxed at 10%. Therefore, the tax paid on the first $46,000 of taxable income would be 10% of $46,000, which is $4,600. So, option A) is the correct answer.