Assignment 1 (Chapter 1)
ACC 351/5
Note: I had originally planned to have you type answers. However, I am instead going to allow
either handwritten or typed work. However, make sure the different problems and answers
are clearly marked. This can be done by circling it, double underlining it, or highlighting it. If
you make it too difficult to find the answer within your work, I will not count the answer correct. If
you have multiple answers, I will not count it correct even if one of the answers is correct. Staple
multiple pages together and make sure your name is on each page. If pages come loose without a
name, the grading will be only on what is left attached.
Show your work throughout. If your answer is wrong and you do not show your work, then
I cannot offer any partial credit.
1. Gill and Molly are married and for 2016 each made $50,000 and $30,000 of taxable income
in wages, respectively. In addition, Molly received $13,000 of interest income from a municipal
bond investment that is not taxable.
Use the appropriate Federal Tax Rate Schedule in Appendix D towards the back of your book to
answer the following. Round dollar amounts to the nearest cent ($3,500.0372 $3,500.04).
Round percentages to the second decimal place (e.g. 35.027956% 35.03%).
a. What are Gill’s total income and taxable income?
Total income: $50,000
Taxable income: $50,000
b. What are Molly’s total income and taxable income?
Total income: $43,000 (includes $13,000 non-taxable interest)
Taxable income: $30,000
c. If Gill and Molly file jointly as a married couple for 2016:
i. What is their total tax
= $10,367.50 + [($80,000 − $75,300) × 0.25]
= $11,542.50
ii. What is their average tax rate?
= $11,542.50 ÷ $80,000
= 14.43%
iii. What is their effective tax rate?
= $11,542.50 ÷ $93,000
= 12.41%
2. In the city of King’s Landing, Bronn lives and works as a sell-sword (someone who is willing
to fight with his sword for pay). His most recent client, Tyrion Lannister, has been very generous
this year (2016) offering $50,000 already for his first two fights this year. However, Tyrion
recently approached Bronn offering an additional $50,000 if he would be willing to fight
Gregore Clegane the next day (still in 2016). Assume Bronn files as a single taxpayer and that
whatever he receives from Tyrion constitutes his taxable income.
Use the appropriate Federal Tax Rate Schedule in Appendix D towards the back of your book to
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ACC 351/5
Note: I had originally planned to have you type answers. However, I am instead going to allow
either handwritten or typed work. However, make sure the different problems and answers
are clearly marked. This can be done by circling it, double underlining it, or highlighting it. If
you make it too difficult to find the answer within your work, I will not count the answer correct. If
you have multiple answers, I will not count it correct even if one of the answers is correct. Staple
multiple pages together and make sure your name is on each page. If pages come loose without a
name, the grading will be only on what is left attached.
Show your work throughout. If your answer is wrong and you do not show your work, then
I cannot offer any partial credit.
1. Gill and Molly are married and for 2016 each made $50,000 and $30,000 of taxable income
in wages, respectively. In addition, Molly received $13,000 of interest income from a municipal
bond investment that is not taxable.
Use the appropriate Federal Tax Rate Schedule in Appendix D towards the back of your book to
answer the following. Round dollar amounts to the nearest cent ($3,500.0372 $3,500.04).
Round percentages to the second decimal place (e.g. 35.027956% 35.03%).
a. What are Gill’s total income and taxable income?
Total income: $50,000
Taxable income: $50,000
b. What are Molly’s total income and taxable income?
Total income: $43,000 (includes $13,000 non-taxable interest)
Taxable income: $30,000
c. If Gill and Molly file jointly as a married couple for 2016:
i. What is their total tax
= $10,367.50 + [($80,000 − $75,300) × 0.25]
= $11,542.50
ii. What is their average tax rate?
= $11,542.50 ÷ $80,000
= 14.43%
iii. What is their effective tax rate?
= $11,542.50 ÷ $93,000
= 12.41%
2. In the city of King’s Landing, Bronn lives and works as a sell-sword (someone who is willing
to fight with his sword for pay). His most recent client, Tyrion Lannister, has been very generous
this year (2016) offering $50,000 already for his first two fights this year. However, Tyrion
recently approached Bronn offering an additional $50,000 if he would be willing to fight
Gregore Clegane the next day (still in 2016). Assume Bronn files as a single taxpayer and that
whatever he receives from Tyrion constitutes his taxable income.
Use the appropriate Federal Tax Rate Schedule in Appendix D towards the back of your book to
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