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First Bank has some question as to the tax-free nature of $5 million of its municipal bond portfolio. This amount is excluded from First Banks
First Bank has some question as to the tax-free nature of $5 million of its municipal bond portfolio. This amount is excluded from First Banks taxable income of $40 million. Management has determined that there is a 60% chance that the tax-free status of this interest cant withstand scrutiny of taxing authorities. |
Assuming a 30% tax rate, what amount of income tax expense should the bank report? (Enter your answer in million. Round your answer to 1 decimal place.) |
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