William Corporation,which has a fiscal year ending January 31,had the following pretax accounting income and estimated effective annual income tax rates for the first three quarters of the year ended January 31,2008: William's income tax expenses in its interim income statement for the third quarter are:
A)$36,000.
B)$73,500.
C)$46,500.
D)$120,000.

Question

Quizplus · Accepted Answer

To calculate the income tax expense for the third quarter, we need to determine the cumulative tax expense up to the third quarter and then subtract the tax expense already recognized in the first two quarters. The effective tax rate is applied to the cumulative pretax income up to the third quarter, and the difference from the previous quarters' tax expense gives the third quarter's tax expense.

William Corporation,which Has a Fiscal Year Ending January 31,had the Following