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Lintner Beverage Corp. reported the following information from their financial statements: Operating income (EBIT) = $10,500,000 Interest payments on long-term debt = $1,750,000 Dividend income

Lintner Beverage Corp. reported the following information from their financial statements:

Operating income (EBIT) = $10,500,000
Interest payments on long-term debt = $1,750,000
Dividend income = $1,000,000

Calculate Lintner's total tax liability using the corporate tax schedule below:

Taxable Income Tax on Base of Bracket Percentage on Excess above Base
$0-$50,000 $0 15%
$50,000-$75,000 7,500 25
$75,000-$100,000 13,750 34
$100,000-$335,000 22,250 39
$335,000-$10,000,000 113,900 34
$10,000,000-$15,000,000 3,400,000 35
$15,000,000-$18,333,333 5,150,000 38
Over $18,333,333 6,416,667 35

Assume a 70% dividend exclusion for tax on dividends.

a 3292390

b 2892380

c 2738530

d 3077000

e 3692400

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