37 40 Income Taxes for a Corporate Business a Assume that Farm Fresh Produce, Inc is a chain of farmers market kiosks that is organized as a corporation and operates in the upper Midwestern states During the current year, the business realized a Pre Tax Income of $2,350,000 Using the 21 corporate tax rate specified in the Tax Cuts and Jobs Act of 2017, calculate the tax liability for Farm Fresh Produce, Inc for the current year Calculate the After Tax Earnings for Farm Fresh Produce, Inc Assume that Farm Fresh Produce, Inc has 725,000 shares of common stock outstanding and that the firm paid a dividend per share of $0 35 during the current year What is the value of the total dividends paid to the common shareholders of Farm Fresh Produce, Inc during the current year Based on the total dividends paid to the common shareholders that you calculated, what is the value of the earnings that Farm Fresh Produce, Inc retained for future investment during the current year 4 What is the average income tax rate applicable to Farm Fresh Produce, Inc during the current year 5 What was the marginal income tax rate applicable to Farm Fresh Produce, Inc

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37. 40. Income Taxes for a Corporate Business a. Assume that Farm Fresh Produce, Inc. is a chain of farmers market kiosks that is organized

37. 40. Income Taxes for a Corporate Business

a. Assume that Farm Fresh Produce, Inc. is a chain of farmers market kiosks that is organized as a corporation and operates in the upper Midwestern states. During the current year, the business realized a Pre-Tax Income of $2,350,000.

Using the 21% corporate tax rate specified in the Tax Cuts and Jobs Act of 2017, calculate the tax liability for Farm Fresh Produce, Inc. for the current year.
Calculate the After-Tax Earnings for Farm Fresh Produce, Inc.
Assume that Farm Fresh Produce, Inc. has 725,000 shares of common stock outstanding and that the firm paid a dividend per share of $0.35 during the current year. What is the value of the total dividends paid to the common shareholders of Farm Fresh Produce, Inc. during the current year?

Based on the total dividends paid to the common shareholders that you calculated, what is the value of the earnings that Farm Fresh Produce, Inc. retained for future investment during the current year?

4. What is the average income tax rate applicable to Farm Fresh Produce, Inc. during the current year?

5. What was the marginal income tax rate applicable to Farm Fresh Produce, Inc.?