1. A very famous restaurant bought a meat processor 10 years ago for $50K. Its current book value stands at 10K. Given the fame of the restaurant, a regular and loyal patron has offered to buy the meat processor for 60K perhaps because of its potential collector's value. If the income tax on regular business income is 30% and the capital gains tax rate is 20%, how much total tax is owed by the restaurant this year for the sale of the meat processor? Please show formula and work, no excel ! :)

1. A very famous restaurant bought a meat processor 10 years ago for $50K. Its current book value stands at 10K. Given the fame of the restaurant, a regular and loyal patron has offered to buy the meat processor for 60K perhaps because of its potential collector's value. If the income tax on regular business income is 30% and the capital gains tax rate is 20%, how much total tax is owed by the restaurant this year for the sale of the meat processor? Please show formula and work, no excel ! :)

Principles of Microeconomics (MindTap Course List)

8th Edition

ISBN:9781305971493

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter12: The Design Of The Tax System

Section: Chapter Questions

Problem 2PA

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