Builtrite had sales of $1,000,000 and COGS of $280,000. In addition, operating expenses were calculated at 30% of sales. Builtrite also received dividends of $90,000 and paid out common stock dividends of $60,000 to its stockholders. A long-term capital gain of $70,000 was realized during the year along with a capital loss of $40,000

Builtrite has taxable income of $140,000.

Based on their taxable income, calculate Builtrites tax liability using the tax chart.

A $22,250

B $29,665

C $37,850

D $45,750

E $53,450

Part 2

Assuming Builtrite had a taxable income of $14,000,000.

If Builtrite had $60,000 in interest expense, how much would this interest expense cost Builtrite after taxes?

A $0

B $39,000

C $21,000

D $30,000

E $60,000

On Builtrite's balance sheet for the previous year, retained earnings equaled $600,000. This year Builtrite had net profits after tax of $250,000 before paying out $80,000 in dividends to its common stockholders and $20,000 to its preferred stockholders. What is the new level of retained earnings for Builtrite?

A $700,000

B $850,000

C $600,000

D $750,000

Builtrite had net profits after tax of $600,000. Builtrite also paid a common stock dividend of $90,000 and a preferred stock dividend of $30,000. What are the EACS (earnings available to the common stockholder)?

A $600,000

B $540,000

C $480,000

D $570,000