Answered: If a company's net income before tax is…

If a company's net income before tax is $500. If they have a corporate income tax rate of 40% what would their net income be then?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

If a company's net income before tax is $500. If they have a corporate income tax rate of 40% what would their net income be then?

Expert Solution

Step 1

Net income is the difference between income before tax and the tax charged to the company. It can be calculated by deducting the corporate income tax from the earning before tax.

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