Diamond trading has the following data: Sales 500,000 Electricity expense 50,000 Water expense 20,000 Purchases 200,000 Ending Inventory 50,000 Purchase return 10,000 Beginning Inventory 20,000 Income tax expense 25,000

Q: Explain the difference between marginal tax rates and average taxrates.

A: Marginal tax rate : The marginal tax rate is the system by which the federal taxation system makes…

Q: why are the operating taxes in the FCF analysis calculating without taking into account the tax…

A: Interest paid on loans or debts is an expense for the company. Also these interests reduces the…

Q: Define Effective tax rate.

A: Tax: Tax refers to a compulsory payment or a contribution to the state revenue, levied by the…

Q: Explain how does the company’s effective tax rate calculated.

A: Effective interest rate:   An effective interest rate is the real return on savings account or any…

Q: How to calculate the indexed cost base for capital gains tax

A: SOLUTION- CAPITAL GAIN TAX- IT IS A TYPE OF TAX APPLIED  TO THE PROFITS EARNED ON THE SALE OF AN…

Q: Define tax effect theory

A: Tax effect theory explains the impact of taxes on revenue or expense of a company. This theory is…

Q: What distinguishes an income tax from other taxes?

A: A tax is a governmental entity's required financial charge or other kind of levy put on a taxpayer…

Q: How to calculate capital gain tax

A: Capital gain is one of the income heads under the Income Tax Act. It includes the gains arising to…

Q: Answer in points: Question. Difference between average and marginal tax rates

A: Average rate of tax is the amount of taxes paid on total income on average. For example, a business…

Q: What is the tax shield of interest?

A: Interest tax shields: It alludes to the assessment obligation decrease because of the interest…

Q: how does taxes affect Businesses?

A: Taxes According to Tax laws Taxes means the levy of money which was imposed by the government…

Q: What are all type of taxes we need to pay

A: As individuals and as entities we need to pay various direct taxes as well as indirect taxes in our…

Q: What types of income should not be classified as such on a tax return? Why shouldn't they be…

A: Answer Nontaxable income won’t be taxed, whether or not you enter it on your tax return. nontaxable…

Q: What is Income tax payable?

A:

Q: Define Income tax paid

A: Income tax paid is a charge or payment made to the government by the individual or the firms in a…

Q: what are the two components of income tax expense

A: PLEASE LIKE THE ANSWER  Firstly, income tax expense means an amount of tax expense incurred on the…

Q: What are the capital assets subject to capital gains tax?

A: capital assets are significant piece of property which may be the home ,cars investment property…

Q: tax

A:

Q: What are long-term capital gains? Are they taxed like other income? Explain.

A: A long-term capital gain or loss is the gain or misfortune coming about because of the selling of…

Q: What is the appropriate level of taxation?

A: Market efficiency and inefficiency depends on various factors like consumer demand, supply, rate of…

Q: What is the taxable base for federal income taxes? a. Gross income b. Net worth c. Total assets d.…

A: Taxable base is the amount on which income taxes are calculated by applying the applicable rate.

Q: What are the different type of income tax?

A: The answer for the question on the different types of income tax is discussed hereunder : Taxes are…

Q: Where can I find after tax interest income on a balance sheet or income statement(trying to find…

A: Components of income statement: The income statement is part of the financial statement of the firm.…

Q: What’s the difference between marginal and average tax rates?

A: The taxes are the government source of income from the general public. The tax rate are the…

Q: Define average tax rate

A: The taxes are the government source of income from the general public. The tax rate are the…

Q: What are the advantages of an indirect tax such as the VAT compared with an income tax?

A: The objective of this question is to understand the advantages of an indirect tax, specifically…

Q: Distinguish between marginal and average tax rates

A: The tax rate at the margin: Through the use of the marginal tax rate, the federal taxation system…

Q: What are the situs rules on income tax situs on sales of goods?

A: Income tax:A tax charged on the income earned by the individual or corporates by the central…

Q: What is the sales tax? Is it an expense or a liability?

A: Sales tax is the tax on sales which is levied by the government. However, sales tax is an indirect…

Q: Explain the functioning of flat taxation. Which taxpayers are usually subject to a flat tax rate?

A: Flat taxation is a taxation system where all taxpayers are subject to the same tax rate, regardless…

Q: What are FUTA and SUTA taxes? Is there any possible reduction in the FUTA tax rate? If so, what is…

A: Introduction: Employer payroll taxes are paid by the employer from its own funds on the basis of…

Q: Illustrate what is incremental tax rate?

A: Definition: Tax: Tax is the compulsory legal payment that is imposed by the government.…

Q: Why are payroll taxes and sales taxes consideredliabilities?

A:

Q: Explain the difference between tax reliefs and tax credits

A: Taxes are mandatory payments placed on individuals or businesses by a government agency, whether…

Q: How do you reduce taxes by contribution to a define contribution plan?

A: Defined contribution plan: These are the retirement plans wherein the employee and/or the…

Q: What is the tax base for each of the following taxes? Income Tax GST FBT

A: Taxes are the amount of dues that is being payable to the government on account of income earned,…

Q: How does the disposition effect impact investor tax?

A: Introduction: The disposition effect is coined by economists Hersh Shefrin and Meir Statman in a…

Q: How would you differentiate items that are exempted from gross income and items deductible from…

A: Items exempted from gross income refers to income which need not be part of income while calculating…

Q: Discuss the various effects of income taxes on the ability to work, save and invest

A: Income Taxes- Individuals, entities/corporations/firms, and entities/corporations/firms are taxed on…