Question

Use the following tax table to answer this question: ​ Taxable Income Tax Rate \$ 0-...

Use the following tax table to answer this question:

 Taxable Income Tax Rate \$ 0- 50,000 15% 50,001- 75,000 25 75,001- 100,000 34 100,001- 335,000 39 335,001- 10,000,000 34

Bait and Tackle has taxable income of \$411,562. How much does it owe in taxes?

​\$143,759.18

​\$132,281.08

​\$139,931.08

​\$128,603.33

​\$190,462.00

Bait and Tackle has taxable income of \$411,562

To calculate the tax liability (refer the Tax Rates from given tax table)

Income Tax liability of Bait and Tackle = 15% * \$50,000 + 25% * (\$75,000 – \$50,000) + 34% * (\$100,000 – \$75,000) + 39% (\$335,000 - \$100,000) + 34% * (\$411,562 -\$335,000)

=15% * \$50,000 + 25% * \$25,000 + 34% * \$25,000 + 39% * \$235,000 + 34% * \$76,562

= \$7,500 + \$6,250 + \$8,500 + \$91,650 + \$26,031.08

= \$139,931.08

The amount of \$139,931.08 it owe in taxes

Therefore correct answer is option: \$139,931.08

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