a)
To calculate: The tax bill of Corporation G and Corporation I
Introduction:
Tax refers to the charge levied by the government on the individuals or corporations’ income. The corporations have the obligation to pay tax to the government. The tax rate differs based on the income of the company. The tax rate is as follows:
Taxable income | Tax rate |
$0 to $50,000 | 15% |
$50,001 to $75,000 | 25% |
$75,001 to $100,000 | 34% |
$100,001 to $335,000 | 39% |
$335,001 to $10,000,000 | 34% |
$10,000,001 to $15,000,000 | 35% |
$15,000,001 to $18,333,333 | 38% |
$18,333,334 and above | 35% |
b)
To determine: The additional taxes paid by the firms if their income increases by $10,000.
Introduction:
Tax refers to the charge levied by the government on the individuals or corporations’ income. The corporations have the obligation to pay tax to the government. The tax rate differs based on the income of the company. The tax rate is as follows:
Taxable income | Tax rate |
$0 to $50,000 | 15% |
$50,001 to $75,000 | 25% |
$75,001 to $100,000 | 34% |
$100,001 to $335,000 | 39% |
$335,001 to $10,000,000 | 34% |
$10,000,001 to $15,000,000 | 35% |
$15,000,001 to $18,333,333 | 38% |
$18,333,334 and above | 35% |
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Chapter 2 Solutions
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