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Please show workings for each question. 1. Salinger Software was founded in 2015. The company lost money each of its first three years, but was
Please show workings for each question. 1. Salinger Software was founded in 2015. The company lost money each of its first three years, but was able to turn a profit in 2018. Salinger's operating income (EBIT) for its first four years of operations is reported below. Year EBIT 2015 -$100,000,000 2016 - $150,000,000 2017 -$100,000,000 2018 $700,000,000 The company has no debt, so operating income equals earnings before taxes. The corporate tax rate has remained constant at 35%. Assume that the company took full advantage of the carry-back, carry-forward provisions in the Tax Code, and assume that the current provisions were applicable in 2015. How much tax did the company pay in 2018? a. $132,300,000 b. $121,275,000 c. $101,675,000 d. $135,975,000 e. $122,500,000
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