Final answer:
To calculate the total annual income, the combined percentage of 22% for both auto and insurance expenses was used to find that 22% of the total income equals $28,600. The correct answer is C) $28,600.
Step-by-step explanation:
To calculate the total annual income based on a specific allocation for auto and insurance expenses, we need to determine the percentage of these expenses in relation to the total income.
The question states that $28,600 is allocated for both auto and insurance combined, with 10% for insurance and 12% for auto. Hence, the combined percentage dedicated to auto and insurance is 10% + 12% = 22%. To find the total annual income, we can set up a proportion where 22% of the total income equals $28,600:
0.22 × Total Income = $28,600
Next, we solve for the total income:
Total Income = $28,600 / 0.22
Total Income = $130,000
This amount represents the entire income required to allocate $28,600 to auto and insurance expenses based on their respective percentages.