The Talley Corporation had a taxable income of $440,000 from operations after al

Question

The Talley Corporation had a taxable income of $440,000 from operations after all operating costs but before (1) interest charges of $88,000, (2) dividends received of $22,000, (3) dividends paid of $26,400, and (4) income taxes. What are the firm's income tax liability and its after-tax income? Round your answers to the nearest cent. Income tax liability $ After-tax income $ What are the company's marginal and average tax rates on taxable income? (Hint: the average tax rate is the average rate paid on all income.) Round your answers to two decimal places. Marginal tax rate % Average tax rate %

Explanation / Answer

kindly give me good rating and make your own calculation thanks income of $440,000 interest charges of $88,000, dividends received of $22,000, dividends paid of $26,400 Tax = $22,250 + ($319,500 - $100,000)*0.39 Tax= $22,250 + $85,605 = $107,855. After-tax income: Taxable income $319,500 Taxes (107,855) Plus Non-taxable dividends received 10,500 Net income $222,145 Non-taxable dividends: $15,000 x 0.7 = $10,500. Marginal tax rate is 39 percent Average tax rate is $107,855/$319,500 = 33.76%.

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