Find the Saving in Taxes with Specified Tax Credits or Deductions Questions

Post ID: 2599714

1.Someone needs to borrow $11,000

to buy a car and the person has determined that monthly payments of

$225

are affordable. The bank offers a

3-year

loan at

APR, a

4-year

loan at

7.5%,

or a

5-year

loan at

APR. Which loan best meets the person's needs? Explain.

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Part 1

Which loan best meets the person's needs?

(Round to the nearest cent as needed.)

The first loan best meets the person's needs because the monthly payment of $enter your response here

is less than the maximum budgeted amount of

$225

per month.B.

The second loan best meets the person's needs because the monthly payment of $enter your response here

is less than the maximum budgeted amount of

$225

per month.C.

The third loan best meets the person's needs because the monthly payment of $enter your response here

is less than the maximum budgeted amount of

$225

per month.D.

None of the loans meet the person's needs.

2. Compare the monthly payments and total loan costs for the following pairs of loan options. Assume that both loans are fixed rate and have the same closing costs.

You need a $160,000

loan.

Option 1: a 30-year loan at an APR of 8%.

Option 2: a 15-year loan at an APR of 7.5%.

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Part 1

Find the monthly payment for each option.

The monthly payment for option 1 is $enter your response here.

The monthly payment for option 2 is $enter your response here.

(Do not round until the final answer. Then round to the nearest cent as needed.)

3. Suppose you have a student loan of $25,000

with an APR of

for

years. Complete parts (a) through (c) below.a. What are your required monthly payments?

The required monthly payment is $enter your response here.

(Do not round until the final answer. Then round to the nearest cent as needed.)

4. A woman

earned wages of

$36,800,

received

$2900

in interest from a savings account, and contributed

$3900

to a tax-deferred retirement plan.

She

was entitled to a personal exemption of

$3200

and had deductions totaling

$5270.

Find

her

gross income, adjusted gross income, and taxable income.Her gross income was

$enter your response here.

(Simplify your answer.)

5.Decide whether a person should itemize his deductions or take the standard deduction in the following case.

A person's deductible expenditures are $8000

for interest on a home mortgage,

$2300

for contributions to charity, and

$632

for state income taxes. His filing status entitles him to a standard deduction of

$11,500.

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Part 1

Choose the correct answer below.A.

He should itemize his deductions

as it would deduct less money from his taxable income.B.

He should itemize his deductions

as it would deduct more money from his taxable income. C.

He should claim the standard deduction

as it would deduct more money from his taxable income.D.

He should claim the standard deduction

as it would deduct less money from his taxable income.

7. A woman

is in the

10%

tax bracket

and claims

the standard deduction.

How much will

her

tax bill be reduced if

she

qualifies for a

$1000

tax credit?

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Part 1

Her tax bill will be reduced by

$enter your response here.

(Simplify your answer.)

8.Determine how much the following individual will save in taxes with the specified tax credits or deductions.

Rosa is in the 25%

tax bracket and

claims the standard deduction.

How much will her tax bill be reduced if she makes a

$700

contribution to charity?

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Part 1

Her tax bill will be reduced by $enter your response here. (Simplify your answer.)