Question

alex is calculating the taxes his parents owe on $20{,}000$ coins of total income. first, he subtracts a deduction worth $5{,}000$ coins from the total income to find the taxable income. next, he calculates $20\%$ of the taxable income to get the initial tax. lastly, he subtracts a credit worth $1{,}000$ coins from the initial tax bill to get the final tax bill. what percentage of the total income is the final tax bill?

Answer 1

Alex must divide the entire tax bill by the total income and multiply the result by 100 in order to determine the final tax bill's proportion of the total income.

The steps to determine the ultimate tax bill are as follows:

$\cdot$ To determine the taxable income, subtract the deduction from the total income. $\$20,000-\$5,000=\$15,000$

$\cdot$ By dividing the taxable income by the tax rate, determine the starting tax: $\$15,000\cdot\$20\%=\$3,000$

$\cdot$ To get the final tax liability, deduct the credit from the starting tax liability: $\$3,00-\$1,000=\$2,000$

$\cdot$ To get the final tax liability, deduct the credit from the starting tax liability: $\$3,000-\$1,000=\$2,000$

$\$2,000\div\$20,000=0.1$

$0.1\cdot100=10\%$

So my answer is $10\%$.