Will and Grace purchased a home from Eric and Tracy. The closing is set for June 17. The yearly real estate taxes of $2,400 will be paid by Will and Grace at the end of the year. Using the 12 month/30 day method, what will be Will and Grace's share of the taxes? (Note: The sellers get the day of closing.)

Question

Social Studies

Kinsley Schneider

27 June, 16:54

Will and Grace purchased a home from Eric and Tracy. The closing is set for June 17. The yearly real estate taxes of $2,400 will be paid by Will and Grace at the end of the year. Using the 12 month/30 day method, what will be Will and Grace's share of the taxes? (Note: The sellers get the day of closing.)

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Answers (1)

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Homer · Answer 1

Answer: $1,286.67

Explanation:

Yearly tax = $2,400

N. B: Seller gets the closing, Therefore seller pays for 5 months and 17 days starting from January - 17th June. While Bill and Grace pay the rest (18th June till December)

From the yearly tax amount, we can calculate both monthly and daily tax payment using the 12 month/30 days method.

Monthly tax = $2,400 : 12 = $200

Daily tax = $200 : 30 = $6.667

Total tax paid by Will and Grace:

18th June - December = 6 months 13 days:

6 months = 6 * $200 = $1,200

13 days = 13 * $6.667 = $86.671

$1,200 + $86.71 = $1,286.67