Tax bracket and has no recognized capital gains

Assignment Help Financial Management
Reference no: EM131867763

Jonathan owns 100% of Lemon Company. In the current year, Lemon recognizes a long-term capital gain of $70,000 and no other income (or loss). Jonathan is in the 33% tax bracket and has no recognized capital gains (or losses) before considering his ownership interest in Lemon Company. Click here to access the tax table to use for this problem. a. If Lemon is an LLC, what is the tax on the $70,000 long-term capital gain? (No election has been filed under the check-the-box Regulations.) $

Reference no: EM131867763

Questions Cloud

About finding the future value of uneven cash flows : Briefly explain in your own words how you would go about finding the future value of uneven cash flows.
To compute the required rate of return on equity : To compute the required rate of return on equity in a company using the CAPM, is different from using the constant growth model
Write the equation to find present worth : Write the equation to find present worth, if the analysis period is infinite.
What is the present value of the cash flows : What is the present value of the cash flows if comparable investments earn 2% annually?
Tax bracket and has no recognized capital gains : Jonathan is in the 33% tax bracket and has no recognized capital gains (or losses) before considering his ownership interest in Lemon Company.
Longer meets quality requirements for the end product : A piece of production equipment is to be replaced by a new automated model immediately because it no longer meets quality requirements for the end product.
Determine the break-even quantity : Your company is trying to reduce supply-chain costs. There is one component that you are currently purchasing for $20 per unit.Determine the break-even quantity
Overall cost of debt is the weighted average : Assume that the overall cost of debt is the weighted average of that implied by the two outstanding debt issues.
Calculate the appropriate price at which this investor : Calculate the appropriate price at which this investor can contract to buy the asset in one year.

Reviews

Write a Review

Financial Management Questions & Answers

  Sinking fund immediately after repayment of the loan

Mary borrows 5000 for 10 wars at an annual effective interest rate of 10%. She can repay this loan using the amortization method with repayments of 813.73 at the end of each year. The deposits to the sinking fund are equal to 813.73 minus the interes..

  What is current market price of the bonds

What is the current market price of the bonds?

  What is required rate of return on this stock

Woidtke manufacturing’s stock currently sells for $20 a share. What is the required rate of return on this stock.

  Develop five year cash flow estimate for the proposal

Auburn Concrete Inc. is considering the purchase of a new concrete mixer to replace an inefficient older model. If purchased, the new machine will cost $90,000 and is exacted to generate savings of 540.000 per year for five years at the end of which ..

  Two mutually exclusive alternatives

Consider the following two mutually exclusive alternatives:

  How much does state need to deposit in account paying

How much does the State need to deposit in an account paying 8% compounded annually to be able to make the remaining 19 equal payments of $45000 each?

  Assuming the bank charges per-check processing? fee

What is the most Flashbinder Guitars should be willing to pay the bank for the lockbox? service, assuming the bank charges a per-check processing? fee?

  Compute the book value-liquidation value-replacement value

We know the following about Radice. Total assets are $120m, D is $40m, E is $60m, preferred stock of $20m, cash is $10m and the # of shares is 1m. We estimate that the market value of equity is 3 times the book value of it. Finally, a fire sale of th..

  Convertible into common stock of the bond issuer

Use U.S GAAP to determine how to subsequently measure the following financial assets. Three choices of measurement basis are amortized cost, fair value through other comprehensive income, and fair value through profit or loss. Long-term loans that ar..

  Weighted average cost of capital assuming no corporate taxes

A firm has an asset base with a market value of $5.3 million. Its debt is worth $2.5 million. If $0.8 million is paid in interest annually and the shareholders expect a 16% annual return, what is the weighted average cost of capital assuming no corpo..

  What is the current value of a share of efg stock

EFG Inc. reported EBIT of 8.5 million for last year. Depreciation expense totaled 5 million and capital expenditures came to 2.5 million. Free cash flow is expected to grow at a rate of 2.5% for the foreseeable future. EFG's equity beta is 1.25, the ..

  Summarize pros and cons of the six capital budgeting methods

Summarize the pros and cons of the six capital budgeting methods. In what types of situations would capital budgeting decisions be made solely on the basis of project's Net Present Value (NPV)?

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