Nicole’s employer, Poe Corporation, provides her with an automobile allowance of $26,000 every other year. Her marginal tax rate is 32 percent. Answer the following questions relating to this fringe benefit. What is Nicole’s after-tax benefit if she receives the allowance this year? What is Poe’s after-tax cost of providing the auto allowance?
Nicole’s employer, Poe Corporation, provides her with an automobile allowance of $26,000 every other year. Her marginal tax rate is 32 percent. Answer the following questions relating to this fringe benefit. What is Nicole’s after-tax benefit if she receives the allowance this year? What is Poe’s after-tax cost of providing the auto allowance?
Chapter19: Deferred Compensation
Section: Chapter Questions
Problem 56P
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Question
Nicole’s employer, Poe Corporation, provides her with an automobile allowance of $26,000 every other year. Her marginal tax rate is 32 percent. Answer the following questions relating to this
What is Nicole’s after-tax benefit if she receives the allowance this year?
What is Poe’s after-tax cost of providing the auto allowance?
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