My existing business generate $135000 in EBIT. The corporate tax rate applicable to my business is 35%. Deprecaition reported in
1 answer:
You might be interested in
Answer:
The interest rate on corporate bond is 7.87 percent.
Explanation:
The yield on 7-year municipal bond = 4.8%
Given marginal tax rate = 39 percent
Now calculate the interest rate on 7 year corporate bond that has equal risk.
Use the below formula. Here, yield from both type of bond is equated that is yield from corporate bond and yield from municipal bond because it is given that both gives same return after tax.
Interest rate on corporate bond × (1-tax rate) = Municipal bond yield
Interest rate on corporate bond × (1- 0.39) = 4.8
Answer:
The company’s profit margin for the current year ended December 31 (rounded to the nearest decimal point) is 20%
Explanation:
Use the following formula to calculate the Profit Margin
Profit Margin =
Where
Net Income = $20,000
Net Sales = $100,000
Placing values in the formula
Profit Margin =
Profit Margin = 0.2 x 100
Profit Margin = 20%