Marginal tax rate and effective tax rate

Reference no: EM139758

Red, White, Blue, and Magenta have taxable income as follows:

Corporation     Taxable Amount
Blue                   $ 91,000
White                    320,000
Red                       800,000
Magenta               50,000,000

a. Calculate the marginal tax rate and the effective tax rate for each of the C corporations.

b. Explain why the marginal tax rate for a C corporation can exceed 35%, but the effective tax rate cannot.

Reference no: EM139758

Questions Cloud

Evaluate the effect on the profit of the whole company : What would be the effect on the profit of the whole company, if the Training Centre was closed at the beginning of the New Year? Given the allocated costs at 10% of revenue, calculate the number of workshops that must be offered to break-even.

Habit of psychological perspectives : In this assignment you will evaluate the acquisition and maintenance of your habit by using the given four psychological perspectives:

Make of statement of stockholders'' equity : Make of statement of stockholders' equity and A company had the following balances in its stockholders' equity accounts at December

Cost recovery deduction of asset : The income from the business before the cost recovery deduction and the 179 deduction was 810k. She takes additional first year depreciation. Determine the cost recovery deduction with respect to the asset for 2013.

Marginal tax rate and effective tax rate : Calculate the marginal tax rate and the effective tax rate for each of the C corporations. Explain why the marginal tax rate for a C corporation can exceed 35%, but the effective tax rate cannot.

Effect on net income of a change in sales volume : Knowledge about the behavior pattern of a cost is important to understanding the effect on net income of a change in sales volume because as sales volume changes and When a firm has financial leverage

Representative sample of all americans : To interpret scores on it, he is presently giving the test to a representative sample of all Americans.

Computation of breakeven sales and contribution margin : Computation of Breakeven sales and Contribution margin at breakeven and what would be the break even in this case

Role of attributions in our social world : Examine the duty of attributions in our social world. What are attributions, and how do we use them in our daily lives?

User Account

All Pages