Mr. Bawa earns an annual salary of GHC 35,000. He pays 5% of his salary into a Social Security fund. Calculate his taxable income.

April 1, 2026Accounting

ScanSolve AI Answer

April 1, 2026

Answer

GHC 35,000

Step 1: Calculate Social Security Contribution. Mr. Bawa pays 5% of his annual salary into a Social Security fund. Annual Salary = GHC 35,000 $Social Security Contribution = 0.05 \times 35000 = GHC 1750$

a) Calculate his taxable income. Taxable income is the annual salary minus the social security contribution, as it is stated that he pays no tax on this contribution. $Taxable Income = Annual Salary - Social Security Contribution$

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Calculate Social Security Contribution. Mr.

Asked on April 1, 2026Accounting

This accounting problem is solved step by step below, with detailed explanations to help you understand the method and arrive at the correct answer.

ScanSolve AI AnswerAnswered on April 1, 2026

Step 1: Calculate Social Security Contribution. Mr. Bawa pays 5% of his annual salary into a Social Security fund. Annual Salary = GHC 35,000 Social Security Contribution = 0.05 × 35000 = GHC 1750 a) Calculate his taxable income. Taxable income is the annual salary minus the social security contribution, as it is stated that he pays no tax on this contribution. Taxable Income = Annual Salary - Social Security Contribution Taxable Income = 35000 - 1750 =