Accounting Calculations Essay - 550 Words

Accounting Calculations Essay (Essay Sample) Content: Name:Instructor:Institution Affiliation:Course:Date:Calculate for the following corporation:Operating profit $1,000,000Other incomeAdd interest received $25, 000Preferred divided received $50,000Total incomes $1,075,000Less expenseInterest rate $(250,000) Profit before tax (taxable income) $825,000Tax liability (if 35%) $288,750After tax income $536,250d, Average tax is given by: (paid tax/taxable income)*(100) (288,750/825,000)*100 = 35%e, Marginal tax rate, is the rate paid on the last $ of income generated. Hence, marginal tax rate for this case is 34%. Corporations taxable income for the marginal rate is as follows,Taxable income Tax rate0 to 50,00015%50,000 to 75,000$ 7,500 +25% 75,000 to 100,000$13,750 + 34% 100,000 to 335,000$22,250 + 39% 335,000 to 10,000,000$113,900 + 34% 10,000,000 to 15,000,000$3,400,000 + 35% 15,000,000 to 18,333,333$5,150,000 + 38% 18,333, 333 and up35%2a.) Sale price of goods $ 10,000Less Cost of goods sold 35% * $ 10,000 = $ 3,500Unrealized profit $ 6,500Decrease Profit by $ 10,000 in income statement Increase debtors by $ 10,000 in balance sheetb.) Book value of computer system $ 30,000Less Sale priceLoss on disposal of computer sale $ 5,000 Increase loss on disposal of asset by $ 5,000 in income statement Decrease assets by $ 30,000 in balance sheetc.) Dividends on common stock are proposed and the paid. When proposed, they are an accrued expense. When paid the figure crosses out accrued dividends and bank account.Decrease profit after tax by $ 15,000 in income statement Decrease cash on bank by $ 15,000 in balance sheetd.) Accrued taxes once paid crosses out the accrual account against bank accountDecrease profit after tax by $ 11,000 in income statement Decrease accrued taxes by $ 11,000 and decrease cash on bank by $ 11,000 in balance sheet3 Calculate tax refund/tax paid for each year.Year-3-2-10123 Taxable Income500600700-2500300500800Tax paid 40%...