FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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You've received two job offers from the same employer. Assume you have a 30% marginal tax rate.
Option 1: Work at the corporate office, which provides you with access to the company gym
(assume it qualifies as a non-taxable fringe benefit). Equivalent outside gym access would cost
$20,000.
Option 2: Work at a remote site would involve a reduction to your daily commute of 2 hours.
Required: How much would Option 2 have to pay in order for it to deliver an equivalent after-tax
payoff to option 1?
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Transcribed Image Text:You've received two job offers from the same employer. Assume you have a 30% marginal tax rate. Option 1: Work at the corporate office, which provides you with access to the company gym (assume it qualifies as a non-taxable fringe benefit). Equivalent outside gym access would cost $20,000. Option 2: Work at a remote site would involve a reduction to your daily commute of 2 hours. Required: How much would Option 2 have to pay in order for it to deliver an equivalent after-tax payoff to option 1?
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