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GuDViN [60]
3 years ago
6

4. Firm E must choose between two alternative transactions. Transaction 1 requires a cash outlay of $9,000; this expense would b

e non-deductible in the computation of the firm’s taxable income. Transaction 2 requires a cash outlay of $13,500, all of which would be a deductible expense. Determine which transaction has the lesser after-tax cost, assuming: a) Firm E’s marginal tax rate is 20 percent. b) Firm E’s marginal tax rate is 40 percent.
Business
1 answer:
Pie3 years ago
8 0

Answer:

a. Transaction 1

It is not deductible so the Taxable income is $9,000

Transaction 2

It is deductible, taxable income would be;

= 13,500 * ( 1 - Tax)

= 13,500 * ( 1 - 20%)

= $10,800

b. Transaction 1

It is not deductible so the Taxable income is $9,000

Transaction 2

It is deductible, taxable income would be;

= 13,500 * ( 1 - Tax)

= 13,500 * ( 1 - 40%)

= $8,100

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50(0.18 - g)  = 4(1 +g)

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Answer:

Option d is the right one.

Explanation:

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The other options aren't sufficient for the scenario provided. But that will be the best alternative for option d.

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<h3>What is Federal Reserve System (FED)?</h3>

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The Fed offers a secure, adaptable, and stable monetary and financial system to the nation.

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2 years ago
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Zinaida [17]

Answer:

The correct word for the blank space is: the production.

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