West Mountain Radio had a taxable income of $150,000 last year. This year, its tarable income has increased by$50,000.What was its total income taE last year?• What was the effective tax rate on last year's tarable income?• What is its total income tax this year?• Determine its incremental tax rate of this year over last year.

Last year: Taxable income= 150000 Total income tax= 22250 + 39% of (150000-100000) = 22250+19500 =…

Answered: West Mountain Radio had a taxable…

Business

Accounting

West Mountain Radio had a taxable income of $150,000 last year. This year, its taxable income has increased by $50,000.

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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Concept explainers

Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.

Question

West Mountain Radio had a taxable income of $150,000 last year. This year, its tarable income has increased by
$50,000.
What was its total income taE last year?
• What was the effective tax rate on last year's tarable income?
• What is its total income tax this year?
• Determine its incremental tax rate of this year over last year.

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