Mariota Industries has sales of $339,620 and costs of $164,710. The company paid $27,910 in interest...

Question

Question

Mariota Industries has sales of $339,620 and costs of $164,710. The company paid $27,910 in interest and $13,450 in dividends. It also increased retained earnings by $66,350 during the year. If the company's depreciation was $17,405, what was its average tax rate?

Answer 1

Answer #1

rate positively ..

	Net income=	Increase in retained earning + dividend
		66,350+13,450
	Net income=	79800



	sales	339620
	Cost	164,710
	Depreciation	17,405
	Interest	27,910
	Profit before tax	129,595

	Tax = Profit before tax = Net income	49,795
	129595-79800

	Tax rate = 49795/129595	38.42%

	Ans =	38.42%

Answer 2

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