Compute the after-tax cash from the contract

Assignment Help Accounting Basics
Reference no: EM133183760

Question - Company G, which has a 30 percent marginal tax rate, owns a controlling interest in Company J, which has a 21 percent marginal tax rate. Both companies perform engineering services. Company G is negotiating a contract to provide services for a client. Upon satisfactory completion of the services, the client will pay $85,000 cash.

Required -

1. Compute the after-tax cash from the contract assuming that Company G is the party to the contract and provides the services to the client.

2. Compute the after-tax cash from the contract assuming that Company J is the party to the contract and provides the services to the client.

3. Compute the after-tax cash flow for Company G from the contract assuming that Company J is the party to the contract, but Company G actually provides the services to the client.

Reference no: EM133183760

Questions Cloud

Understand what the situation with housing loans is today : Raise the issue so that people understand what the situation with housing loans is today, that many people do not know how to properly prepare for a loan, how t
Standardizing the strategies-campaigns : Why would a company customize their promotional strategies/campaigns over standardizing the strategies/campaigns? Include examples in your assessment.
Compute the annual income tax savings : Compute the annual income tax savings resulting from the gift when the gift consisted of rental property generating $19,100 annual rental income to its owner
Determine the best way to allocate a budget : A practice would like to allocate its resources optimally between the orthopedic and rheumatology departments. The revenues per case generated by orthopedics is
Compute the after-tax cash from the contract : Compute the after-tax cash from the contract assuming that Company G is the party to the contract and provides the services to the client
Find a product you want to import into the usa : 1. Find a product you want to import into the USA. This product can be from any country in the world but cannot be imported in the USA as of the beginning of th
What was marietta corporation cash payment for income taxes : Marietta Corporation shows income tax expense of $240,000 in 2016. What was Marietta Corporation's cash payment for income taxes
Relationship between bill and joe : What other ethical issues might be associated with the relationship between Bill and Joe?
Compare market conditions with company performance : Evaluate economic conditions that influence company performance. Compare market conditions with the company's performance for 2017.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Prepare a summary of the variances

Prepare a summary of the variances. Does the unfavorable overhead volume variance suggest that overhead cost are out of control

  Discuss the auditing and other assurance services your firm

write a letter to apollo shoes addressing the key points listed below assume the role of an auditor at a local firm

  What is the error in total net income for combined period

Doubletree Company's financial statements show the following. The company recently discovered that in making physical counts of inventory.

  What is the business that will be owning

What is the business that you will be owning? Explain one item that you have learned in this accounting course that you did not know before?

  Income is divided based on the partners failure to sign an

summers and winters formed a partnership on january 1. summers contributed 90000 cash and equipment with a market value

  Discuss the old machine and purchase the new model

Should the company sell the old machine and purchase the new model

  Discuss what is the term working capital meant

Determine and Discuss why neither the working capital nor the current ratio tells us anything about the composition of current assets and current liabilities

  How much should you deposit each month

If you make regular monthly deposits. How much should you deposit each month to end up with $63,000 in 8 years

  What is the unadjusted rate of return

What is the unadjusted rate of return?

  Calculate the weighted average number of shares

Pharoah Limited had 41,400 common shares outstanding on January 1, 2020. Calculate the weighted average number of shares

  Change in accounting principle

1.During 2011 (its first year of operations) and 2012, Batali Foods used the FIFO inventory costing method for both financial reporting and tax purposes.

  What is the amount of interest expense account

Pearl Ltd issues $7 million in 5-year debentures that pay interest every 6 months at a coupon rate of 12% per annum. What is amount of interest expense account

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd