1) Green Corporation reported the following activity during the year:
Gross Profit $68,360,820
Operating Expenses $49,001,726
Dividends Received $373,000
(from 12% owned corporation)
a) Calculate the corporation's taxable income and tax liability assuming production activities income amounted to $19,359,094.
b) Calculate the corporation's taxable income and tax liability assuming operating expenses amount to $68,449,371 assuming that production activities income is zero or negative.
c) Calculate the corporation's taxable income and tax liability assuming operating expenses amount to $69,576,275 assuming that production activities income is zero or negative.
Bedford Corporation reported the following activity during the year:
Gross Profit $70,037,630
Dividends Received from 10% owned domestic corporation $271,000
Operating Expenses $44,546,039
Charitable Contributions $8,007,570
2. In addition, the corporation has a net operating loss carry forward from 2015 amounting to $1,808,372, and production activities income amounted to $25,491,591.
a) How much is the corporation's taxable income and tax liability this year?
b) What carryovers are available to the corporation in future years?
Corporate Tax Rate Schedule
If taxable income (Form 1120, Line 30) is:
Over But Not Over Tax Is Of the amount over
$0 $50,000 15% $0
$50,000 $75,000 $7,500 +25% $50,000
$75,000 $100,000 $13,750 +34% $75,000
$100,000 $335,000 $22,250 +39% $100,000
$335,000 $10,000,000 $113,900 +34% $335,000
$10,000,000 $15,000,000 $3,400,000 +35% $10,000,000
$15,000,000 $18,333,333 $5,150,000 +38% $15,000,000
$18,333,333 no limit 35% $0