Mel Company has a net income, before taxes, of $95,000. The treasurer of the company estimates 45% of net income will have to be paid for federal and state taxes. The tax for both federal and state is:
A)$21,111.
B)$42,750.
C)$42,560.
D)$47,250.
E)None of these.

Question

Quizplus · Accepted Answer

To find the tax for both federal and state, we need to multiply the net income by the percentage of net income estimated to be paid for taxes:
$95,000 x 0.45 = $42,750.
Therefore, the tax for both federal and state is $42,750, which is answer choice B.

Mel Company Has a Net Income, Before Taxes, of $95,000