tax liability
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The Angell Company has earned $150,000 before taxes during each of the last 15 years, and it
expects to earn $150,000 per year before taxes in the future. This year, however, the firm
incurred a loss of $650,000. It will claim a tax credit at the time it files this year’s income tax
return, and it will receive a check from the U.S. Treasury. Show how Angell calculates this
credit, and then indicate the firm’s tax liability for each of the next five years. Assume a 30
percent tax rate on all income to simplify the calculations
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- Suppose that Blake Companys total pretax difference from a change to FIFO was 100,000 and the company pays a bonus of 5% of its income before income taxes and bonus to employees. If Blake pays an additional bonus | based on the change in income, would it recognize any expense? If so, when and how much?A company wants to set up a new office in a country where the corporate tax rate is: 15% of first $50,000 profits, 25% of next $25,000, 34% of next $25,000, and 39% of everything over $100,000. Executives estimate that they will have gross revenues of $500,000, total costs of $300,000, $30,000 in allowable tax deductions, and a one-time business start-up credit of $8000. What is taxable income for the first year, and how much should the company expect to pay in taxes?Rainmian Company has agreed to pay its sales manager a bonus of 5% of his or her earnings after bonuses and taxes. Before bonuses and taxes, the annual income is USD5,250,000. The income tax rate is 30% of after-bonus earnings. If the bonus has not yet been paid, how much current liability for bonus should be reported at the end of the year?
- Firm A expects to receive a $25,000 item of income in August and a second $25,000 item of income in December. The firm could delay the receipt of both items until January. As a result, it would defer the payment of tax on $50,000 income for one full year. Firm A decides to receive the August payment this year (and pay current tax on $25,000 income) but delay the receipt of the December payment. Can you offer an explanation for this decision?The company is planning to provide services to a client and receives $90,000 in year 2020. The client has the option to pay the money in the current year or over the next 3 years. Accordingly, Pioneer has the option of reporting the profit in the current year or over the next 3 years. Assume that Pioneer’s uses 9% discount rate and its marginal tax rate is 35% in year 2020 and 40% in the next three years. Which option should the company select? And whyUsing the Train act shown below, how much annual tax will be paid by a salesman who earns a basic salary of Php. 450,000.00 per year plus a commission of 20% if he sold over Php. 30,000? Assuming the salesman was able to sell Php. 50,000 regularly per month. He has a total deduction of Php. 70,000 per year. What is his monthly tax deduction?
- Brady and Sons uses accounts receivable as collateral to borrow money for operations and payroll when revenues are low. If the company borrows $300,000 now at an interest rate of 12% per year, compounded monthly, and the rate increases to 15% per year, compounded monthly after 4 months, how much will the company owe at the end of 1 year?Zara Corporation borrowed RM100,000 from their bank for one year. The bank required the company to pay RM9,500 in interest at the end of the year plus maintain a minimum balance of RM10,000 with the bank in a chequing account throughout the year. What is the effective interest rate on this loan?The federal corporate income tax rate is 35 percent and firms may carry-back losses for two years and carry-forward losses for 20 years. The carry-back must occur before carry-forward. A corporation breaks even in year 1, earns $31,000 in year 2, but operates at a loss of $92,000 in year 3. It earns $66,000 in year 4, breaks even in year 5, and earns $40,000 in year 6. What are the taxes paid or refunded in each year? Enter your answers as positive values. If the answer is zero, enter "0". Round your answers to the nearest dollar. Year 1 2 3 4 5 6 Taxes $ $ $ $ $ $ Tax refund or tax offset $ $ $ $ $ $ Net taxes paid $ $ $ $ $ $
- K Ltd. paid an employee a tax-free travel allowance of $5,300 based on 9,000 kilometres of out-of-town driving in 2022. What amount can K deduct for tax purposes?Perkin Corporation has determined that it qualifies for a tax credit in the amount of $120,000. For the current year, it has tax liability before credits of $75,000. It expects at least that amount of tax liability next year. Required: If the excess credit is not refundable but may be carried forward, calculate the value of the credit. Assume Perkins uses a 4 percent discount rate to calculate present value. If the excess credit is refundable, what is the value of the credit?A firm pays $22,000,000 in compensation to its 401K participants in 2021. What is the maximum tax-deferred contribution the firm can make in 2021? (Round to the nearest whole dollar)
