Exhibit 9-1
A flat tax plan allows individuals to deduct a standard allowance of $25,000 from their wages. Assume that the flat tax rate is 12%.
-Refer to Exhibit 9-1. How much income tax would you have to pay if you were earning $100,000 a year?

Question

​Exhibit 9-1
A flat tax plan allows individuals to deduct a standard allowance of $25,000 from their wages. Assume that the flat tax rate is 12%.
-Refer to Exhibit 9-1. How much income tax would you have to pay if you were earning $100,000 a year?

Quizplus · Accepted Answer

First, subtract the standard allowance from the total income: $100,000 - $25,000 = $75,000. Then, apply the 12% tax rate: $75,000 * 0.12 = $9,000.

​Exhibit 9-1 A Flat Tax Plan Allows Individuals to Deduct a Standard

Exhibit 9-1 A Flat Tax Plan Allows Individuals to Deduct a Standard