In general, a maximum of 25% to 30% of one's gross income can be spent on rent. So, according to this lets find out the values.
Given is,
The gross annual salary of Kathleen = $56820
So, her monthly income becomes = [tex]\frac{56820}{12}= 4735[/tex]
So, its 25% is = [tex]\frac{25}{100}\times4735[/tex] = 1183.75
And 30% becomes = [tex]\frac{30}{100}\times4735[/tex] = 1420.50
If we take an average of both, as the value will lie between these two figures we get, (1183.75+1420.50)/2 = $1302.12
Hence, this value lies close to $1326. So, the answer will be option B - $1326
