The Wendt Corporation had $10.5 million of taxable income.a. What is the company’s federal income tax bill for the year?b. Assume the firm receives an additional $1 million of interest incomefrom some bonds it owns. What is the additional tax on this interestincome?c. Now assume that Wendt does not receive the interest income but doesreceive an additional $1 million as dividends on some stock it owns.What is the additional tax on this dividend income?

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Fringe benefits are in addition to the compensation that companies give to their employees. It is an additional benefit above the stated salary. It helps to keep the employees of the firm motivated as sometimes the only salary is not enough to retain the quality employees of the firm. There are different types of fringe benefits. Fringe benefits are given in both private as well as public enterprises.