Company P must choose between two alternate transactions. The cash generated by Transaction $1$ is taxable, and the cash generated by Transaction $2$ is nontaxable.

Required:

Determine the marginal tax rate at which the after$-$tax cash flows from the two transactions are equal assuming that Transaction $1$ generates $$140,000$ of income and Transaction $2$ generates $$93,800$ of income.

Determine the marginal tax rate at which the after$-$tax cash flows from the two transactions are equal assuming that Transaction $1$ generates $$235,000$ of income and Transaction $2$ generates $$195,050$ of income.