This year, Mesa Inc.’s before-tax income was $11,377,000. It paid $539,000 income tax to Minnesota and...

Question

Question

This year, Mesa Inc.’s before-tax income was $11,377,000. It paid $539,000 income tax to Minnesota and...

This year, Mesa Inc.’s before-tax income was $11,377,000. It paid $539,000 income tax to Minnesota and $457,000 income tax to Illinois.

a. Compute Mesa’s federal income tax.

b. What is Mesa’s tax rate on its income?

business accounting

Add a comment Improve this question Transcribed image text

Answer 1

Answer #1

Total state income tax = M’s tax + I’s tax

= 539,000 + 457,000

= 996,000

This is to be deducted from before-tax income for getting “taxable income for Federal tax purpose”.

Taxable income for Federal tax purpose = Before-tax income – Total state income tax

= 11,377,000 – 996,000

= 10,381,000

This year corporate tax rate is 21%.

a.

Federal income tax = Taxable income for Federal tax purpose × Corporate tax rate

= 10,381,000 × 21%

= 2,180,010 (Answer)

b.

Total tax = 996,000 + 2,180,010 = 3,176,010

Tax rate = (Total tax / Before-tax income) × 100

= (3,176,010 / 11,377,000) × 100

= 27.92% (Answer)

Add a comment

Answer 2

Similar Homework Help Questions

This year, Mesa Inc.’s before-tax income was $10,814,500. It paid $494,000 income tax to Minnesota and...

This year, Mesa Inc.’s before-tax income was $10,814,500. It paid $494,000 income tax to Minnesota and $430,000 income tax to Illinois. Compute Mesa’s federal income tax. What is Mesa’s combined tax rate on its income?
This year, Mesa Inc.’s before-tax income was $10,814,500. It paid $494,000 income tax to Minnesota and...

This year, Mesa Inc.’s before-tax income was $10,814,500. It paid $494,000 income tax to Minnesota and $430,000 income tax to Illinois. Compute Mesa’s federal income tax. What is Mesa’s combined tax rate on its income?
This year, Mesa Inc.'s before-tax income was $10,314,500. It paid $454,000 income tax to Minnesota and...

This year, Mesa Inc.'s before-tax income was $10,314,500. It paid $454,000 income tax to Minnesota and $406,000 income tax to Illinois. a. Compute Mesa's federal income tax. b. What is Mesa's tax rate on its income? Complete this question by entering your answers in the tabs below. Required A Required B What is Mesa's tax rate on its income? (Do not round any intermediate division. Round your final answer to 2 decimal places.) Combined tax rate < Required A Required...

Im not sure what am I entering wrong. help please This year, Mesa Inc.'s before-tax income was $10,439,500. It paid...

Im not sure what am I entering wrong. help please This year, Mesa Inc.'s before-tax income was $10,439,500. It paid $464,000 income tax to Minnesota and $412,000 income tax to Illinois a. Compute Mesa's federal income tax, b. What is Mesa's tax rate on its income? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required A Required B Compute Mesa's federal income tax, Federal income * 3,251,590 Required >
GT Inc.’s net income before tax on its financial statements was $700,000, and its taxable income...

GT Inc.’s net income before tax on its financial statements was $700,000, and its taxable income was $810,000. The $110,000 difference is the aggregate of temporary book/tax differences. GT’s tax rate is 21 percent. Compute GT’s tax expense for financial statement purposes. Compute GT’s tax payable. Compute the net increase in GT’s deferred tax assets or deferred tax liabilities (identify which) for the year.
Cremshaw Inc.’s auditors prepared the following detail reconciliation between book and taxable income. Cremshaw’s income tax...

Cremshaw Inc.’s auditors prepared the following detail reconciliation between book and taxable income. Cremshaw’s income tax rate is 21%. Book income before tax $650,000 Bad debt allowance $25,000 Meals ($30,000 * 50%) $15,000 Tax-exempt interest income $(20,000) Wages not paid in 2 ½ months $45,000 Taxable income $715,000 Compute the net increase in Cremshaw’s deferred tax assets or liabilities for the year and identify whether deferred tax assets or liabilities increased.

Compute NOPAT Using Tax Rates from Tax Footnote The income statement for The TJX Companies, Inc.,...

Compute NOPAT Using Tax Rates from Tax Footnote The income statement for The TJX Companies, Inc., follows. THE TJX COMPANIES, INC. Consolidated Statements of Income Fiscal Year Ended ($ thousands) January 29, 2005 Net sales $14,913,483 Cost of sales, including buying and occupancy costs 11,398,656 Selling, general and administrative expenses 2,500,119 Provision (credit) for computer intrusion related costs - Interest expense (revenue), net 25,757 Income from continuing operations before provision for income taxes 988,951 Provision for income taxes 379,252 Income...
Compute NOPAT Using Tax Rates from Tax Footnote The income statement for The TJX Companies, Inc.,...

Compute NOPAT Using Tax Rates from Tax Footnote The income statement for The TJX Companies, Inc., follows. THE TJX COMPANIES, INC. Consolidated Statements of Income Fiscal Year Ended ($ thousands) January 29, 2011 Net sales $21,942,193 Cost of sales, including buying and occupancy costs 16,040,461 Selling, general and administrative expenses 3,710,053 Provision (credit) for computer intrusion related costs (11,550) Interest expense (revenue), net 39,137 Income from continuing operations before provision for income taxes 2,164,092 Provision for income taxes 824,562 Income...
Fico, Inc. earns $172,000 in book income before tax and is subject to a 21% tax...

Fico, Inc. earns $172,000 in book income before tax and is subject to a 21% tax rate in its first year of operations. Fico, Inc.. estimates that it will incur $7,000 over the next two years to honor warranties on products sold during the current year and recorded the appropriate liability on its balance sheet at the end of the year. Determine the amount of Fico's deferred tax assets and liabilities, if any, as of the end of the year

Apex Inc. reports the following for a recent year: Income from continuing operations before income tax...

Apex Inc. reports the following for a recent year: Income from continuing operations before income tax $1,860,000 Loss from discontinued operations $235,000* Weighted average number of shares outstanding 10,000 Applicable tax rate 40% *Net of any tax effect A. Prepare a partial income statement for Apex Inc., beginning with income from continuing operations before income tax.** B. Determine the earnings per common share for Apex Inc., including per-share amounts for unusual items.** ** Refer to the list of Labels and...

This year, Mesa Inc.’s before-tax income was $11,377,000. It paid $539,000 income tax to Minnesota and...

Homework Answers

Add Answer to:
This year, Mesa Inc.’s before-tax income was $11,377,000. It paid $539,000 income tax to Minnesota and...

Post as a guest

Earn Coins

This year, Mesa Inc.’s before-tax income was $10,814,500. It paid $494,000 income tax to Minnesota and...

This year, Mesa Inc.’s before-tax income was $10,814,500. It paid $494,000 income tax to Minnesota and...

This year, Mesa Inc.'s before-tax income was $10,314,500. It paid $454,000 income tax to Minnesota and...

Im not sure what am I entering wrong. help please This year, Mesa Inc.'s before-tax income was $10,439,500. It paid...

GT Inc.’s net income before tax on its financial statements was $700,000, and its taxable income...

Cremshaw Inc.’s auditors prepared the following detail reconciliation between book and taxable income. Cremshaw’s income tax...

Compute NOPAT Using Tax Rates from Tax Footnote The income statement for The TJX Companies, Inc.,...

Compute NOPAT Using Tax Rates from Tax Footnote The income statement for The TJX Companies, Inc.,...

Fico, Inc. earns $172,000 in book income before tax and is subject to a 21% tax...

Apex Inc. reports the following for a recent year: Income from continuing operations before income tax...

This year, Mesa Inc.’s before-tax income was $11,377,000. It paid $539,000 income tax to Minnesota and...

Homework Answers

Add Answer to: This year, Mesa Inc.’s before-tax income was $11,377,000. It paid $539,000 income tax to Minnesota and...

Post as a guest

Earn Coins

Add Answer to:
This year, Mesa Inc.’s before-tax income was $11,377,000. It paid $539,000 income tax to Minnesota and...