Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

JDD Corporation provides the following benefits to its employee, Ahmed (age 50): Salary $ 339,000 Health insurance 14,700 Dental insurance 2,100 Life insurance 3,900 Dependent

JDD Corporation provides the following benefits to its employee, Ahmed (age 50):

Salary $ 339,000
Health insurance 14,700
Dental insurance 2,100
Life insurance 3,900
Dependent care 4,200
Professional dues 1,310
Personal use of company jet 259,000

Assume the life insurance is a group-term life insurance policy that provides $294,000 of coverage for Ahmed. (Use EXHIBIT 12-8.) Assuming Ahmed is subject to a marginal tax rate of 32 percent, what is his after-tax benefit of receiving each of these benefits (ignoring FICA taxes)? (Enter all amounts as positive values. Round your intermediate computations and final answers to the nearest whole dollar.)

image text in transcribed

Description Amount Taxable benefits $ 339,000 Salary Life insurance (taxable portion) Personal use of company jet 14,700 259,000 Taxable total $ 612,700 Marginal tax rate % Income tax on benefits After-tax benefit of taxable items Nontaxable benefits Dental insurance Dependent care Health insurance Life insurance (nontaxable portion) Professional dues Nontaxable total $ 0 After-tax benefit of salary and benefits $ 0

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial and managerial accounting

Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso

1st edition

111800423X, 9781118233443, 1118016114, 9781118004234, 1118233441, 978-1118016114

More Books

Students also viewed these Accounting questions