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Nicoles employer, Poe Corporation, provides her with an automobile allowance of $27,000 every other year. Her marginal tax rate is 30 percent. Poe Corporation has
Nicoles employer, Poe Corporation, provides her with an automobile allowance of $27,000 every other year. Her marginal tax rate is 30 percent. Poe Corporation has a marginal tax rate of 35 percent. Answer the following questions relating to this fringe benefit. A. What is Nicoles after-tax benefit if she receives the allowance this year (ignore FICA taxes)? After-tax benefit $ B. What is Poes after-tax cost of providing the auto allowance? After-tax cost $
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