Question
The Delta Steel Company has just completed their break-even analysis for the next fiscal year. They are unsure of how much income taxes they must
The Delta Steel Company has just completed their break-even analysis for the next fiscal year. They are unsure of how much income taxes they must pay if sales increase by 20%. With the 20% increase they will just break-even. Advise the company accordingly and select the one correct answer below.
A. | They have nothing to worry about, since there are no income taxes at the break-even point. | |
B. | They should also expect a 20% increase in income taxes due and payable.
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C. | None of the above.
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D. | Try to find a buyer for the company before anyone finds out they are not making a profit.
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E. | The should try to seek governmental relief from any increase in income taxes, since they are struggling. |
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