Goose Industries faces the following tax schedule. Last year the company realized $15,000,000 in operating income (EBIT). Its annual interest expense is $7,500,000.
(1) Compute the company’s income taxes payable? Use the tax rate table below.
(2) What was the company’s net income for the year?
|
If a corporation's taxable income is |
It pays this amount on the base of the bracket |
Plus this percentage on the excess over the base (marginal rate) |
Average tax rate at top of bracket |
|
Up to $50,000 |
$0 |
15% |
15.0% |
|
$50,000 – $75,000 |
$7,500 |
25% |
18.3% |
|
$75,000 – $100,000 |
$13,750 |
34% |
22.3% |
|
$100,000 – $335,000 |
$22,250 |
39% |
34.0% |
|
$335,000 – $10,000,000 |
$113,900 |
34% |
34.0% |
|
$10,000,000 – $15,000,000 |
$3,400,000 |
35% |
34.3% |
|
$15,000,000 – $18,333,333 |
$5,150,000 |
38% |
35.0% |
|
Over $18,333,333 |
$6,416,667 |
35% |
35.0% |
|
(1) $2,436,000 (2) $4,950,000 |
||
|
(1) $2,550,000 (2) $4,950,000 |
||
|
(1) $2,550,000 (2) $7,500,000 |
||
|
(1) $2,436,000 (2) $7,500,000 |
||
|
(1) $113,900 (2) $4,950,000 |
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