quetion 24

Your company is considering the purchase of a fleet of cars for $195,000. It can borrow at 9%. The cars will be used for four years. At the end of four years they will be worthless. You call a leasing agent and find that the cars can be leased for $55,000 per year. The corporate tax rate is 34% and the cars belong in CCA class 10 (a 30% class), what is the net advantage to leasing?

Select one:

a. $7,771

b. $21,802

c. $15,363

d. $5,399

e. $6,594

question 21

Given a tax rate of 13% for income up to $50,000, a tax rate of 25% for income between $50,001 and $75,000, and a tax rate of 34% for income between $75,001 and $100,000, and a tax rate of 39% for income above $100,001, if ABC Inc. reports taxable income of $190,000. How large is this firm's tax bill?

Select one:

a. $56,350

b. $78,000

c. $48,750

d. $91,125

e. $57,350