1. Capri Company had gross income realized of $180,000, deductions of $45,000, a $5,000 tax exclusion, and a tax credit of $2,000. How much was Capri's tax expense?

2. Carmichael Company is considering purchasing a piece of equipment for $60,000. It expects the equipment will last 12 years (and will then be worthless) and each year will generate $7,200 net income before taxes. Carmichael's tax rate is 21%. What would be Carmichael's expected before-tax cash flow if it purchased this asset?

3. Diaz, Inc. is considering investing in equipment that will cost $100,000 and is expected to last for 10 years with no salvage value. Diaz expects the equipment will earn net income before taxes of $12,000 per year. How much is Diaz's net expected cash flow after taxes if the company's tax rate is 21%?

4. Hamlin Company had net income of $18,000. On the income statement Hamlin had shown $6,000 for business meals with clients, $4,000 in federal income taxes, $1,000 in penalties, and $6,000 in interest income from municipal bonds. What is Hamlin's taxable income?