John Dufresne purchased 100 shares of Louisiana Power and Light on January 3, 2004 at a total cost of $1,983. On December 29, 2005, he sold these shares and netted $2,689, after commissions. Mr. Dufresne has a marginal tax rate of 25% and an average tax rate of 17%. To the nearest dollar, what is the effect on Marty's tax bill from the sale of these shares? OA. $0.00 B. $177 OC. $106 OD. $120
John Dufresne purchased 100 shares of Louisiana Power and Light on January 3, 2004 at a total cost of $1,983. On December 29, 2005, he sold these shares and netted $2,689, after commissions. Mr. Dufresne has a marginal tax rate of 25% and an average tax rate of 17%. To the nearest dollar, what is the effect on Marty's tax bill from the sale of these shares? OA. $0.00 B. $177 OC. $106 OD. $120
Chapter13: Choice Of Business Entity—general Tax And Nontax Factors/formation
Section: Chapter Questions
Problem 42P
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Transcribed Image Text:John Dufresne purchased 100 shares of Louisiana Power and Light on January 3, 2004 at a total cost
of $1,983. On December 29, 2005, he sold these shares and netted $2,689, after commissions. Mr.
Dufresne has a marginal tax rate of 25% and an average tax rate of 17%. To the nearest dollar, what is the
effect on Marty's tax bill from the sale of these shares?
A. $0.00
OB. $177
OC. $106
D. $120
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