Question

The Celluloid Collar Corporation has $210,000 in tax loss carryforwards. The Bowstring Shirt Company, a firm in the 21% tax bracket, would be willing to pay (on a non-discounted basis) the sum of ______________ for Celluloid Collar Corporation’s carryforward alone.

Answer 1

Answer:

$44,100

Explanation:

The computation of the sum of carry forward alone is shown below:

= Tax loss carry forward × tax rate

= $210,000 × 21%

= $44,100

Simply we multiplied the tax loss carry forward with the tax rate so that the correct amount can come i.e sum of carry forward alone or we can say the tax loss which is carry forward alone