In 2016, NB Inc.\'s federal taxable income was $242,000. Compute the required in
ID: 2521029 • Letter: I
Question
In 2016, NB Inc.'s federal taxable income was $242,000. Compute the required installment payments of 2017 tax in each of the following cases: Use Corporate tax rate schedule.
a. NB’s 2017 taxable income is $593,000.
b. NB’s 2017 taxable income is $950,000.
c. NB’s 2017 taxable income is $1,400,000.
CORPORATE TAX RATES
If taxable income is: The tax is:
Not over $50,000 15% of taxable income
Over $50,000 but not over $75,000 $7,500 + 25% of the excess over $50,000
Over $75,000 but not over $100,000 $13,750 + 34% of the excess over $75,000
Over $100,000 but not over $335,000 $22,250 + 39% of the excess over $100,000
Over $335,000 but not over $10,000,000 $113,900 + 34% of the excess over $335,000
Over $10,000,000 but not over $15,000,000 $3,400,000 + 35% of the excess over $10,000,000
Over $15,000,000 but not over $18,333,333 $5,150,000 + 38% of the excess over $15,000,000
Over $18,333,333 $6,416,667 + 35% of the excess over $18,333,333
Connect C Secure I https/ Produ. C Secure Ch 11 APs6 CORPORATE TAX RATES 6 If taxable income Problem 11-28 [LO 11-6] ,ccess over $50000 34% ofthe excess over $75.000 O er $50000 bu! not over S 75,000 Over 575,000 but not over 5100,000 Over $100.000 but not over $335000 Over $335,000 but not over $10,000.000 Over $10000000 bul net over %15,000,000 Over $15 000 000 but not over % 18. 333.333 n 206, NB Inc sfederal sable income was $242.000 Compute the required instalment peyments of 2017 tax in esch of the folowing cases Ue Se.atecceate . NB's 2017 a $13,750 + 22,250 39% of the encess over stoo.o00 5113900 +34%ofthe e-cess over %335 000 $3.150,000 +38% dye ecess over $1500000 544 16 667 +35%ofre eKes5 over $1 10.000 NE'S 2017 abie income i 400.000Explanation / Answer
Answer
Answer (a) Taxable Income $593,000
Cumulative Taxable Income
$ 50,000.00
$ 75,000.00
$ 1,00,000.00
$ 3,35,000.00
$ 5,93,000.00
Taxable Income (A)
$ 50,000.00
$ 25,000.00
$ 25,000.00
$ 2,35,000.00
$ 2,58,000.00
Tax Rate (B)
15%
25%
34%
39%
34%
Tax on Income (A x B)
$ 7,500.00
$ 6,250.00
$ 8,500.00
$ 91,650.00
$ 87,720.00
Total Income taxes
$201,620
Answer (b) Taxable Income $ 950,000
Cumulative Taxable Income
$ 50,000.00
$ 75,000.00
$ 1,00,000.00
$ 3,35,000.00
$ 9,50,000.00
Taxable Income
$ 50,000.00
$ 25,000.00
$ 25,000.00
$ 2,35,000.00
$ 6,15,000.00
Tax Rate
15%
25%
34%
39%
34%
Tax on Income
$ 7,500.00
$ 6,250.00
$ 8,500.00
$ 91,650.00
$ 2,09,100.00
Total Income taxes
$ 323,000
Answer (c) Taxable Income $ 1,400,000
Cumulative Taxable Income
$ 50,000.00
$ 75,000.00
$ 1,00,000.00
$ 3,35,000.00
$ 14,00,000.00
Taxable Income
$ 50,000.00
$ 25,000.00
$ 25,000.00
$ 2,35,000.00
$ 10,65,000.00
Tax Rate
15%
25%
34%
39%
34%
Tax on Income
$ 7,500.00
$ 6,250.00
$ 8,500.00
$ 91,650.00
$ 3,62,100.00
Total Income taxes
$ 476,000
Answer (a) Taxable Income $593,000
Cumulative Taxable Income
$ 50,000.00
$ 75,000.00
$ 1,00,000.00
$ 3,35,000.00
$ 5,93,000.00
Taxable Income (A)
$ 50,000.00
$ 25,000.00
$ 25,000.00
$ 2,35,000.00
$ 2,58,000.00
Tax Rate (B)
15%
25%
34%
39%
34%
Tax on Income (A x B)
$ 7,500.00
$ 6,250.00
$ 8,500.00
$ 91,650.00
$ 87,720.00
Total Income taxes
$201,620
Answer (b) Taxable Income $ 950,000
Cumulative Taxable Income
$ 50,000.00
$ 75,000.00
$ 1,00,000.00
$ 3,35,000.00
$ 9,50,000.00
Taxable Income
$ 50,000.00
$ 25,000.00
$ 25,000.00
$ 2,35,000.00
$ 6,15,000.00
Tax Rate
15%
25%
34%
39%
34%
Tax on Income
$ 7,500.00
$ 6,250.00
$ 8,500.00
$ 91,650.00
$ 2,09,100.00
Total Income taxes
$ 323,000
Answer (c) Taxable Income $ 1,400,000
Cumulative Taxable Income
$ 50,000.00
$ 75,000.00
$ 1,00,000.00
$ 3,35,000.00
$ 14,00,000.00
Taxable Income
$ 50,000.00
$ 25,000.00
$ 25,000.00
$ 2,35,000.00
$ 10,65,000.00
Tax Rate
15%
25%
34%
39%
34%
Tax on Income
$ 7,500.00
$ 6,250.00
$ 8,500.00
$ 91,650.00
$ 3,62,100.00
Total Income taxes
$ 476,000
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