ABC Corporation is in a 25% income tax bracket.John Adams is an employee at ABC.He is in a 40% tax bracket.The company has offered John a 10% pay raise.His current salary is $50,000.
Required:
A)Calculate the after-tax cost of the raise to the corporation.
B)Calculate the after-tax cost of the raise for John.
Show all calculations.
Correct Answer:
Verified
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