Chapter3-Problems - Corporate Income Taxes with Excluded...

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Corporate Income Taxes with Excluded Dividends Griffey Communications recently realized $225,000 in o The company had interest income of $15,000 and realiz The company’s interest expense was $50,000. Operating Income 225,000 Interest Income 15,000 Dividends (70% excluded) 18,000 Less Interest Expense (50,000) Tax on Base Taxable Income of Bracket Up to $50,000 $0 $50,000-$75,000 7,500 $75,000-$100,000 13,750 $100,000-$335,000 22,250 $335,000-$10,000,000 113,900 $10,000,000-$15,000,000 3,400,000 $15,000,000-$18,333,333 5,150,000 Over $18,333,333 6,416,667
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operating income. zed $60,000 in dividend income. Total Pre-Tax 208,000 % on Excess Bracket Bracket above Base Amount Tax 15% 25% 34% 39% 34% 35% 38% 35% Total -
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Collins Co. began operations in 2005. The company lost money th but has been profitable ever since. The company’s taxable incom first five years is summarized below: Year EBT CF/CB Used 2005 ($4,000,000) 0 2006 ($2,800,000) 0 2007 $3,200,000 $3,200,000 2008 $8,300,000 $3,600,000 2009 ($2,800,000) $2,800,000 The corporate tax rate has remained at 34%. Assume that the com full advantage of the Tax Code’s carry-back, carry-forward provisi the current provisions were applicable in 2005. What is the tax lia
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he first two years, me (EBT) for its Tax CB/CF Left 0 $4,000,000 0 $6,800,000 0 CF $3,600,000 $1,598,000 CF $0 ($952,000) CB $0 mpany has taken ions, and assume ability for 2008 and 2009?
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