Ben spends 20% of his after-tax income on his car. If his car payment is $400 and he pays 1/3 of his gross income in taxes, how much does he make per month before taxes?
How much does Ben spend on his car? ** First divide that amount of the car payment by 20% to find Ben's after-tax salary: $400 / .2 = $<<400/.2=2000>>2000
How much does Ben keep after taxes? ** Then find the proportion of his salary Ben keeps after taxes by subtracting the tax rate from 1: 1 - 1/3 = 2/3
How much does Ben make before taxes? ** Then divide Ben's after-tax salary by the proportion of his salary he keeps to find his before-tax salary: $2000 / 2/3 = $3000
#### 3000