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Andrews Corporation has income from operations of $229,000
Andrews Corporation has income from operations of $229,000. In addition, it received interest income of $22,900 and received dividend income of $30,100 from another corporation. Finally, it paid $11,800 of interest income to its bondholders and paid $47,100 of dividends to its common stockholders. Using the 2013 corporate tax schedule, what is the firm’s federal income tax? Round your intermediated and final answers to the nearest cent.
Expert Solution
Solution: Calculation pof Taxable Income:-
(Amount in $)
| Particulrs | Amount | Amount |
| Income From Operation | 2,29,000.00 | |
| Add: Interest Income | 22900.00 | |
| Add: Dividend (30% of 30100) | 9030.00 | 31930.00 |
| Less: Interest Paid | (11800.00) | |
| Net Taxable Income | 249130.00 |
Calculation of Federal Income Tax:-
As per Income Tax Schedule The taxable income is fall in bracket ($ 100000 to $ 335000). Hence Tax is:-
22500 Plus 39% of (249130 Less 100000) = 22500+58160.70 = 80660.7 $ Or 80661.00 (Roud Off ) Figure.
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