Number 9

3 marks · Normal

In the country of Kalculus, Seema earned $60,000 per year and paid $14,000 in income tax. Was this correct? Justify your answer with clear working, using the tax bands: 20% for $0–$50,000 and 40% for amounts above $50,000.

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No, Seema should have paid $12,000 in income tax; $14,000 is not correct.

Also accept: She overpaid, correct tax is $12,000

Common mistakes: Applying the higher rate to the full amount.

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Marking points

M1 · 1 mark · Attempt to use the correct tax bands for calculation.

R1 · 1 mark · Accurate working: $50,000 × 20% = $10,000; $10,000 × 40% = $4,000; total $14,000. Notice and correct any error. (follow-through)

B1 · 1 mark · Justify with the correct result and conclude if $14,000 is correct or not. (follow-through)

Worked solution

Tax on first $50,000: $50,000 × 0.20 = $10,000

Tax on remaining $10,000: $10,000 × 0.40 = $4,000

Total tax should be $10,000 + $4,000 = $14,000; Seema's tax is correct.