The following tax schedule applies to an individual. Her taxable income is $40,000. How much is her total tax? 10% of the first $10,000
15% of the next $15,000
25% of the next $10,000
35% of the next $20,000

Question

Quizplus · Accepted Answer

First compute the tax for each tier of the income:

- 10% of the first $10,000 = $1,000 
- 15% of the next $15,000 = $2,250 
- 25% of the next $10,000 = $2,500 
- 35% of the remaining $5,000 = $1,750

Total tax = $1,000 + $2,250 + $2,500 + $1,750 = $7,500.

Therefore, the correct choice is (C).

The Following Tax Schedule Applies to an Individual