Explore BrainMass
Share

Explore BrainMass

    Comprehensive Income and Tax Liability

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    A person has earnings of $50,000 this year. The market value value of her condominium that she purchased this year for $100,000 has increased by 5 percent. Assuming that the rate of inflation is 3 percent, and that she has neither capital losses nor earnings, and receives no transfers, calculate her comprehensive income. If she were subject to a comprehensive income tax at a 20 percent flat tax rate, what would her tax liability be for the year?

    © BrainMass Inc. brainmass.com October 10, 2019, 1:50 am ad1c9bdddf
    https://brainmass.com/business/accounting/comprehensive-income-tax-liability-351330

    Solution Preview

    Total Earnings = 50,000 + 0.5*100,000 = 55,000
    Tax Liability = .2*55,000 = 11,000

    Usually, you do not ...

    Solution Summary

    The solution explains the solution in a very clear way and it is very wasy to follow along. The solution must be downloaded by students who are looking to undertand how to solve such questions in the future. It provides a good understanding of the problem. Overall, an excellent response.

    $2.19