Problem 2-27 Corporate Taxes (LG2-3)

The Dakota Corporation had a 2021 taxable income of $30,500,000 from operations after all operating costs but before (1) interest charges of $8,300,000, (2) dividends received of $730,000, (3) dividends paid of $5,150,000, and (4) income taxes (the firms tax rate is 21 percent).

a. Calculate Dakotas income tax liability. (Round your answer to the nearest dollar amount.)

Income tax liability_________.

b. What are Dakotas average and marginal tax rates on taxable income? (Round your answers to 2 decimal places.)

Average tax rate. ________%

Marginal tax rate_________%