Question

G. R. Edwin Inc. had sales of ​$6.02 million during the past year. The cost of goods sold amounted to ​$3.06 million. Operating expenses totaled ​$2.65 ​million, and interest expense was ​$27 comma 000. Determine the​ firm's tax liabilityby using the corporate tax rate structure in the popup​ window.

Answer 1

Answer:

Explanation:

Assume: The Federal Alternative Minimum Tax rate of 20%

G.R EDWIN INC          $

Sales                           6, 020, 000.00

Less:

Cost of goods sold     3, 060,000.00

Gross profit                 2,960,000.00

Less:

Operating Expenses   2,650,000.00

Profit                                310,000.00

Less: Int Expense              27,000.00

Net Profit                          283,000.00

Tax liability assuming tax rate of 20%

= 283,000 * 20%

=$56,600