0 Required information Comprehensive Problem 4-54 (LO 4-1, LO 2, LO 4-3) The fol

Question

0 Required information Comprehensive Problem 4-54 (LO 4-1, LO 2, LO 4-3) The following information applies to the questions displayed belowJ Marc and Michelle are married and earned salaries this year of $64,000 and $12,000, respectively In addition to their salaries, they received interest of $350 from municipal bonds and $500 from corporate bonds. Marc contributed $2,500 to an individual retirement account, and Marc paid alimony to a prior spouse in the amount of $1,500. Marc and Michelle have a 10-year-old son, Matthew, who lived with them throughout the entire year Thus, Marc and Michelle are allowed to claim a $2,000 child tax credit for Metthew. Marc and Michelle poid $6,000 of expenditures thet qualify as itemized deductions and they had a total of $5,500 in federal income taxes withheld from their paychecks during the course of the Comprehensive Problem 4-54 Part-a through e a. What ls Marc and Michelle's gross income? Gross income b. What is Marc and Michelle's adjusted gross income? Prese 1 2 of 4 doc kendall-sad9.trf_13.doc

Explanation / Answer

Question Particulars Amount Amount a Gross income: Salary        76,000 Business income             500 Gross income        76,500 For AGI deductions          4,000 b AGI        72,500 Less: Standard deduction        24,000 Itemized deduction          6,000 c Higher of the two        24,000 d Taxable income        48,500 Income tax liability 5,439.00 Payments: Withholding          5,500 Non-refundable credits          2,000 Total payments 7,500.00 e Refund due    2,061.00

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