Find the tax on an income of N20,000 if no tax is paid on the first N10,000 and tax is paid at N50 in N1000 on the next N5000 and at N55 in N1000 on the rem...

Find the tax on an income of N20,000 if no tax is paid on the first N10,000 and tax is paid at N50 in N1000 on the next N5000 and at N55 in N1000 on the remainder

Answer Details

To calculate the tax on an income of N20,000 using the given tax rules, we need to break down the income into three parts: 1. The first N10,000: No tax is paid on this amount. 2. The next N5,000: Tax is paid at N50 for every N1000, so the tax on N5,000 would be (N5,000/N1,000) x N50 = N250. 3. The remainder of N5,000: Tax is paid at N55 for every N1000, so the tax on N5,000 would be (N5,000/N1,000) x N55 = N275. Therefore, the total tax on an income of N20,000 would be N0 + N250 + N275 = N525. In summary, the tax on an income of N20,000 using the given tax rules is N525, which is option (D).