Ross Martin arrived at the following tax information: Tax Information Gross salary $ 49,300 Interest earnings 500 Dividend income 140 One personal exemption 3,950 Itemized deductions 8,740 Adjustments to income 1,690 What amount would Ross report as taxable income?

Question

Business

Audrina Armstrong

14 January, 01:38

Ross Martin arrived at the following tax information: Tax Information Gross salary $ 49,300 Interest earnings 500 Dividend income 140 One personal exemption 3,950 Itemized deductions 8,740 Adjustments to income 1,690 What amount would Ross report as taxable income?

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Answers (1)

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Angelique Burton · Answer 1

The taxable income is $35,560

Explanation:

In this question, we are asked to calculate the amount which Ross will report as taxable income.

We proceed as follows;

Firstly, we calculate adjusted gross income

Mathematically, adjusted gross income = Gross income - Adjustments

= ($49,300 + 500 + 140) - 1690 = $48,250

Taxable income = Adjusted gross income - Personal exemption - itemized deductions

= 48,250 - 3,950 - 8,740 = $35,560