Question

Ellen Furasawa grosses $49,700 annually, with personal exemptions of $4,400. The state taxes 1 percent on the first $3,000, 3 percent on an amount over $3,000. What is her taxable income?

a) $45,300
b) $44,300
c) $46,700
d) $48,200

Answer 1

Ellen Furasawa's taxable income is calculated by subtracting her personal exemptions from her gross annual income, resulting in a taxable income of $45,300.

Step-by-step explanation:

To calculate Ellen Furasawa's taxable income, we first subtract her personal exemptions from her gross annual income. Ellen grosses $49,700 annually and has personal exemptions totaling $4,400.

The formula for taxable income is:

taxable income = gross income - personal exemptions

Using the information provided:

taxable income = $49,700 - $4,400 = $45,300

Therefore, Ellen's taxable income would be $45,300, which corresponds with option (a).