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The Talley Corporation had a taxable income of $395,000 from operations after all operating costs...

Question:

The Talley Corporation had a taxable income of $395,000 from operations after all operating costs but before (1) interest charges of $79,000, (2) dividends received of $11,850, (3) dividends paid of $15,800, and (4) income taxes. What are the firm's income tax liability and its after-tax income? Round your answers to two decimal places.

A) Income tax liability is what?

B)After-tax income is what? This answer is not 211,679.

Interest Expenses:


Interest paid is a non-operating expense for any business. Only those expenses which are incurred in day to day business are classified as operating expenses. Interest expense is only incurred when company takes a loan for business purposes.

Answer and Explanation:


Taxable income = $395,000

Less: Interest expense = $79,000

Add: Dividend received = $11,850

Total taxable income = $327,850


This amount falls in...

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Average Tax Rate: Definition & Formula

from Business Law: Help and Review

Chapter 23 / Lesson 15
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