For the year 20X1, Tally Corporation reported $50,000 pre-tax proﬁt (average annual income tax rate of 40%). What was the after-tax proﬁt?

Question

Quizplus · Accepted Answer

The after-tax profit is calculated by subtracting the tax from the pre-tax profit. With a 40% tax rate on a $50,000 pre-tax profit, the tax amount is $50,000 * 0.40 = $20,000. Therefore, the after-tax profit is $50,000 - $20,000 = $30,000.

For the Year 20X1, Tally Corporation Reported $50,000 Pre-Tax Proﬁt