Government Q imposes a net income tax on businesses operating within its jurisdiction.The tax equals 3% of income up to $500,000 and 5% of income in excess of $500,000.Company K generated $782,000 net income this year.Compute the income tax that Company K owes to Q.

Question

Quizplus · Accepted Answer

Company K pays 3% on the first $500,000, which is $15,000, and 5% on the remaining $282,000, which is $14,100. The total tax is $15,000 + $14,100 = $29,100.

Government Q Imposes a Net Income Tax on Businesses Operating