Ask Question
19 June, 19:23

A woman earned wages of $32 comma 000 , received $2600 in interest from a savings account, and contributed $3500 to a tax-deferred retirement plan. She was entitled to a personal exemption of $4050 and had deductions totaling $7090. Find her gross income, adjusted gross income, and taxable income.

+3
Answers (1)
  1. 19 June, 21:42
    0
    1. Gross income = $34,600

    2. Adjusted gross income = $31,100

    3. Taxable income = $19,960

    Explanation:

    Given data;

    Earned wages = $32,000

    Interest received = $2600

    Tax contribution = $3500

    Personal exemption = $4050

    Deductions = $7090

    1. Gross income; All earnings before any tax payment or deductions

    Gross income = $32,000 + $2600

    =$34,600

    2. Adjusted gross income:

    The adjusted amount from the question is $3500,

    Therefore,

    Adjusted gross income = Gross income - adjusted amount

    = $34,600 - $3500

    = $31,100

    3. Taxable income: It's calculated using the formula;

    Taxable income = adjusted gross income - exemption + deductions

    Substituting, we have;

    Taxable income = $31,100 - ($4050 + $7090)

    = $31,100 - $11,140

    =$19,960
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “A woman earned wages of $32 comma 000 , received $2600 in interest from a savings account, and contributed $3500 to a tax-deferred ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers