Griffey Communications recently realized $102,500 in operating income. The company had interest income of $15,000 and realized $70,000 in dividend income. The company's interest expense was $30,000. Its corporate tax rate is 25%. Griffey is a small company, so it is not subject to the interest expense deduction limitation. Assume a 50% dividend exclusion for taxes on dividends. Which of the following most closely matches the tax liability of Griffey Communications? O a. $30.625 O b. $46,875 OC. $38,125 O d. $39.375 Oe. $21,875

Griffey Communications recently realized $102,500 in operating income. The company had interest income of $15,000 and realized $70,000 in dividend income. The company's interest expense was $30,000. Its corporate tax rate is 25%. Griffey is a small company, so it is not subject to the interest expense deduction limitation. Assume a 50% dividend exclusion for taxes on dividends. Which of the following most closely matches the tax liability of Griffey Communications? O a. $30.625 O b. $46,875 OC. $38,125 O d. $39.375 Oe. $21,875

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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(Corporate income tax) Last year Sanderson, Inc. had sales of $3.0 million. The firm's cost of goods sold came to $2.0 million, its operating expenses excluding depreciation of $100,000 were $400,000, and the firm paid $150,000 in interest on its bank loans. Also, the corporation received $50,000 in dividend income (from a company in which it owned less than 20 percent of its shares but paid $25,000 in the form of dividends to its own common stockholders. Use the corporate tax rates shown in the popup window,, to calculate the corporation's tax liability. What are the firm's average and marginal tax rates? Etext pages @ 2 The firm's tax liability for the year is $. (Round to the nearest dollar.) S W * X H Get more help - # 3 E D 80 13 C $ 4 900 000 14 R F V % 5 FS T G A 6 B MacBook Air F6 Y H & 7 N F7 U J * 8 DII Fa I M l 9 MOSISO D K DD 19 O V H - C 0 L F10 P > Clear all - : ; I F11 { [ command option + 11 = ? Check answer "1 1 13) F12 } 1 delet
(Corporate income tax) The Robbins Corporation is an oil wholesaler. The firm's sales last year were $1.01 million, with the cost of goods sold equal to $590,000. The firm paid interest of $211,250 and its cash operating expenses were $104,000. Also, the firm received $45,000 in dividend income from a firm in which the firm owned 22% of the shares, while paying only $11,000 in dividends to its stockholders. Depreciation expense was $48,000. Use the corporate tax rates shown in the popup window, , to compute the firm's tax liability. What are the firm's average and marginal tax rates? ☑ The Robbins Corporation's tax liability for the year is $ (Round to the nearest dollar.) Data table Taxable Income Marginal Tax Rate $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% (Click on the icon in order to copy its contents into a spreadsheet.)
Griffey Communications recently realized $90,000 in operating income. The company had interest income of $35,000 and realized $70,000 in dividend income. The company’s interest expense was $60,000. Its corporate tax rate is 25%. Griffey is a small company, so it is not subject to the interest expense deduction limitation. Assume a 50% dividend exclusion for taxes on dividends
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