Corporate Taxes The AOK Corporation had a 2013 taxable income of $2,200,000 from operations after all operating costs but before
(1)interest charges of $90,000,
(2)dividends received of $750,000,
(3)dividends paid of $80,000,and
(4)income taxes.
Using the tax schedule in Table 2.3,what is AOK's income tax liability?
What are AOK's average and marginal tax rates on taxable income from operations?

Question

Quizplus · Accepted Answer

The taxable income is $2,200,000. Using the tax schedule, the tax liability is $793,900. The average tax rate is calculated as tax liability divided by taxable income, which is 36.0864%. The marginal tax rate for this income level is 34%.

Corporate Taxes the AOK Corporation Had a 2013 Taxable Income