**Table 2.3: Corporate Tax Rates as of 2018** This table provides a breakdown of corporate tax rates based on different ranges of taxable income. The table is divided into three columns: 1. **Taxable Income**: This column specifies the income ranges for corporations, starting from $0 and extending beyond $18,333,333. 2. **Pay this Amount on Base Income**: This column shows the fixed amount to be paid as tax on income that falls within the base range specified in the "Taxable Income" column. The values are: - $0–$50,000: $0 - $50,001–$75,000: $7,500 - $75,001–$100,000: $13,750 - $100,001–$335,000: $22,250 - $335,001–$10,000,000: $113,900 - $10,000,001–$15,000,000: $3,400,000 - $15,000,001–$18,333,333: $5,150,000 - Over $18,333,333: $6,416,667 3. **Plus this Percentage on Anything Over the Base**: This column lists the percentage rate that must be applied to any income exceeding the base amount within each income range. The percentages are: - $0–$50,000: 15% - $50,001–$75,000: 25% - $75,001–$100,000: 34% - $100,001–$335,000: 39% - $335,001–$10,000,000: 34% - $10,000,001–$15,000,000: 35% - $15,000,001–$18,333,333: 38% - Over $18,333,333: 35% This table helps businesses understand their tax obligations based on income brackets, clarifying both the fixed amount to be paid and the applicable percentage rate for any excess income. **Oakdale Fashions, Inc. Tax Calculation** Oakdale Fashions, Inc. had $245,000 in 2018 taxable income. Using the tax schedule in Table 2.3 to calculate the company's 2018 income taxes. *(Round your answer to the nearest dollar amount.)* - **Income taxes:** [Input box] **What is the average tax rate?** *(Round your answer to 2 decimal places.)* - **Average tax rate:** [Input box] % **What is the marginal tax rate?** - **Marginal tax rate:** [Input box] % *Note: Table 2.3 is referenced but not visible in the image, so detailed data from the table cannot be provided.*
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
![**Oakdale Fashions, Inc. Tax Calculation**
Oakdale Fashions, Inc. had $245,000 in 2018 taxable income.
Using the tax schedule in Table 2.3 to calculate the company's 2018 income taxes. *(Round your answer to the nearest dollar amount.)*
- **Income taxes:** [Input box]
**What is the average tax rate?** *(Round your answer to 2 decimal places.)*
- **Average tax rate:** [Input box] %
**What is the marginal tax rate?**
- **Marginal tax rate:** [Input box] %
*Note: Table 2.3 is referenced but not visible in the image, so detailed data from the table cannot be provided.*](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F504f9a44-b97f-4fd5-a72d-264d10f13ba2%2F5f05460c-5c1c-4d7b-9fe7-6c8393caf231%2Fm3tlhfm.jpeg&w=3840&q=75)
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