A consumer electronics company was formedto develop cell phones that run on or are rechargedby fuel cells. The company purchased a warehouseand converted it into a manufacturing plant for$6,000,000. It completed installation of assemblyequipment worth $1,500,000 on December 31st. Theplant began operation on January 1st. The companyhad a gross income of $8,500,000 for the calendaryear. Manufacturing costs and all operating expenses,excluding the capital expenditures, were $2,280,000.The depreciation expenses for capital expendituresamounted to $456,000.(a) Compute the taxable income of this company.(b) How much will the company pay in federalincome taxes for the year?
A consumer electronics company was formed
to develop cell phones that run on or are recharged
by fuel cells. The company purchased a warehouse
and converted it into a manufacturing plant for
$6,000,000. It completed installation of assembly
equipment worth $1,500,000 on December 31st. The
plant began operation on January 1st. The company
had a gross income of $8,500,000 for the calendar
year.
excluding the capital expenditures, were $2,280,000.
The depreciation expenses for capital expenditures
amounted to $456,000.
(a) Compute the taxable income of this company.
(b) How much will the company pay in federal
income taxes for the year?
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