San Remo has a $4,000,000 asset investment and is subject to a 30% income tax rate....
San Remo has a $4,000,000 asset investment and is subject to a 30% income tax rate. Cash inflows are expected to average $600,000 before tax over the next few years; in contrast, average income before tax is anticipated to be $500,000. The company's after-tax accounting rate of return is:
8.75%.
10.50%.
12.50%.
15.00%
None of these.
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San Remo has a $4,000,000 asset investment and is subject to a
30% income tax rate....
2018 Tax Rate Schedules Individuals Schedule X-Single If taxable income is over: But not over: The...
2018 Tax Rate Schedules Individuals Schedule X-Single If taxable income is over: But not over: The tax is: $ 0 $ 9.525 10% of taxable income $ 9,525 $ 38,700 5952.50 plus 12% of the excess over $9,525 $ 38,700 $ 82,500 $4,453.50 plus 22% of the excess over $38,700 $ 82,500 $157,500 $14.089.50 plus 24% of the excess over $82,500 $157,500 $200,000 $32.089.50 plus 32% of the excess over $157,500 $200,000 $500,000 $45.689 50 plus 35% of the excess...
1. The current pretax income for Stapler Inc is $67,000 (tax rate is 24%), with an...
1. The current pretax income for Stapler Inc is $67,000 (tax rate is 24%), with an average asset base of $230,000, and an expected return of 15 percent or higher. The ROI for Stapler Inc would amount to: 3. Lynn Corporation expected to use 1.1 direct labor hours to produce one unit of their product, at a rate of $12/DLH. Actual results for last year indicate that they sold 420,000 units, where their direct labor workforce actually worked 500,000 hours...
You are the CFO of a business and have the opportunity to evaluate two different investment...
You are the CFO of a business and have the opportunity to evaluate two different investment opportunities. Information related to these investments follows: Investment Cost Salvage Value Useful Life Required Rate of Return Sales Variable Costs Fixed Costs (excluding depreciation) Tax Rate Investment 1 $ 900,000 $ 90,000 9 years 10% $ 500,000 $ 200,000 $ 100,000 35% Investment 2 $ 600,000 $ 60,000 12 years 10% $ 500,000 $ 240,000 $ 120,000 35% Your company has a required rate...
Marc, a single taxpayer, earns $135,000 in taxable income and $2,500 in interest from an investment...
Marc, a single taxpayer, earns $135,000 in taxable income and
$2,500 in interest from an investment in city of Birmingham Bonds.
Using the U.S. tax rate schedule for year 2018, what is his average
tax rate? (Use tax rate schedule)
Multiple Choice
19.77%
16.54%
11.96%
26.54%
None of the choices are correct.
2018 Tax Rate Schedules Individuals Schedule X-Single If taxable income is over: But not over: The tax is: $ 0 $ 9,525 10% of taxable income $ 9,525...
The statutory federal tax rate had been 35% for a number of years. Assume that late...
The statutory federal tax rate had been 35% for a number of years. Assume that late in the third quarter of 2020, a new rate, 40%, was approved as the new enacted rate, effective as of January 1, 2020 You are an assistant controller with Zenics Inc., a manufacturer of laser printers. The CEO of the company is concemed about what effect, if any, the new tax rate will have on 2020 earnings. At the beginning of the year, Zenics...
Subject 1 (30%) A. (20%) During the past years, ABG had limited its investment plans due...
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Golden Gate Construction Associates, a real estate developer and building contractor in San Francisco, has two...
Golden Gate Construction Associates, a real estate developer and building contractor in San Francisco, has two sources of long-term capital: debt and equity. The cost to Golden Gate of issuing debt is the after-tax cost of the interest payments on the debt, taking into account the fact that the interest payments are tax deductible. The cost of Golden Gate's equity capital is the investment opportunity rate of Golden Gate's investors, that is, the rate they could earn on investments of...
Wendy Co. and Juan Co. traded the above equipment. The exchange LACKS commercial Wendy's Books Juan's Books 4) Exxon Inc. has net income (20% tax rate) of S5,000,000 for 2019, and an aver...
Wendy Co. and Juan Co. traded the above equipment. The exchange LACKS commercial Wendy's Books Juan's Books 4) Exxon Inc. has net income (20% tax rate) of S5,000,000 for 2019, and an average number of shares outstanding during the year of 500,000 shares The corporation issued $4,000,000 par value of 20-year, 8% convertible bonds on January 1, 2020 at a $200,000 discount. The convertible bonds are convertible into 140,000 shares of common stock Assume the company uses the straight-line method...
Question #1 At the end of 2017, Payne Industries had a deferred tax asset account with...
Question #1 At the end of 2017, Payne Industries had a deferred tax asset account with a balance of $38 million attributable to a temporary book-tax difference of $95 million in a liability for estimated expenses. At the end of 2018, the temporary difference is $85 million. Payne has no other temporary differences. Taxable income for 2018 is $240 million and the tax rate is 40%. Payne has a valuation allowance of $11 million for the deferred tax asset at...
Corporate Tax Rates as of 2015 (Table 2.3 of textbook) Taxable Income Pay this amount on...
Corporate Tax Rates as of 2015 (Table 2.3 of textbook) Taxable Income Pay this amount on base income Plus this percentage on anything over the base $0 – $50,000 $0 15% $50,001 – $75,000 $7,500 25% $75,001 – $100,000 $13,750 34% $100,001 – $335,000 $22,250 39% $335,001 – $10,000,000 $113,900 34% $10,000,001 – $15,000,000 $3,400,000 35% $15,000,000 – $18,333,333 $5,150,000 38% Over $18,333,333 $6,416,667 35% Greatland, Inc. had $284,000 in 2015 taxable income. Using the tax schedule from Table 2.3,...
2018 Tax Rate Schedules Individuals Schedule X-Single If taxable income is over: But not over: The tax is: $ 0 $ 9.525 10% of taxable income $ 9,525 $ 38,700 5952.50 plus 12% of the excess over $9,525 $ 38,700 $ 82,500 $4,453.50 plus 22% of the excess over $38,700 $ 82,500 $157,500 $14.089.50 plus 24% of the excess over $82,500 $157,500 $200,000 $32.089.50 plus 32% of the excess over $157,500 $200,000 $500,000 $45.689 50 plus 35% of the excess...
You are the CFO of a business and have the opportunity to evaluate two different investment opportunities. Information related to these investments follows: Investment Cost Salvage Value Useful Life Required Rate of Return Sales Variable Costs Fixed Costs (excluding depreciation) Tax Rate Investment 1 $ 900,000 $ 90,000 9 years 10% $ 500,000 $ 200,000 $ 100,000 35% Investment 2 $ 600,000 $ 60,000 12 years 10% $ 500,000 $ 240,000 $ 120,000 35% Your company has a required rate...
Marc, a single taxpayer, earns $135,000 in taxable income and
$2,500 in interest from an investment in city of Birmingham Bonds.
Using the U.S. tax rate schedule for year 2018, what is his average
tax rate? (Use tax rate schedule)
Multiple Choice
19.77%
16.54%
11.96%
26.54%
None of the choices are correct.
2018 Tax Rate Schedules Individuals Schedule X-Single If taxable income is over: But not over: The tax is: $ 0 $ 9,525 10% of taxable income $ 9,525...
The statutory federal tax rate had been 35% for a number of years. Assume that late in the third quarter of 2020, a new rate, 40%, was approved as the new enacted rate, effective as of January 1, 2020 You are an assistant controller with Zenics Inc., a manufacturer of laser printers. The CEO of the company is concemed about what effect, if any, the new tax rate will have on 2020 earnings. At the beginning of the year, Zenics...
Subject 1 (30%) A. (20%) During the past years, ABG had limited its investment plans due to high cost of capital. Recently, however, the cost of capital seems to have fallen, and the management of the company is seriously considering the implementation of two major investment plans. Assume that you are the assistant of the ABG's financial director, who has assigned you to calculate the company's cost of capital. Your financial manager has provided the following information: 1. The corporate...
Golden Gate Construction Associates, a real estate developer and building contractor in San Francisco, has two sources of long-term capital: debt and equity. The cost to Golden Gate of issuing debt is the after-tax cost of the interest payments on the debt, taking into account the fact that the interest payments are tax deductible. The cost of Golden Gate's equity capital is the investment opportunity rate of Golden Gate's investors, that is, the rate they could earn on investments of...
Wendy Co. and Juan Co. traded the above equipment. The exchange LACKS commercial Wendy's Books Juan's Books 4) Exxon Inc. has net income (20% tax rate) of S5,000,000 for 2019, and an average number of shares outstanding during the year of 500,000 shares The corporation issued $4,000,000 par value of 20-year, 8% convertible bonds on January 1, 2020 at a $200,000 discount. The convertible bonds are convertible into 140,000 shares of common stock Assume the company uses the straight-line method...
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