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##### Accounting Four Problems Assignment

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Question;1) ABC recently reported \$42,198 of sales, \$13,908of operating costs other than depreciation, and \$5,423 of depreciation. The company had no amortization charges and no non-operating income. It had \$8,000 of bonds outstanding that carry a 10% interest rate. How much was the firm's taxable income, or earnings before taxes (EBT)?Hint: Interest rate = Bonds outstanding * interest rate2) During 2007, ABC had sales of \$67,381. Cost of goods sold, administrative expenses and selling expenses, and depreciation expenses were \$27,193, \$4,346, and \$9,541, respectively. In addition, the company had an interest expense of \$4,439, and a tax rate of 33%. The company paid\$7,528 as dividends. If the retained earnings is 2006 were \$51,649, what are the retained earnings in 2007?3) An investor recently purchased a corporate bond that yields 9.3%. The investor is in the 31% combined federal and state tax bracket. What is the bond's after-tax yield?4) ABC company had a taxable income of \$187,859 from operations after all operating costs but before interest charges of \$59,616, dividends received of \$74,677, dividends paid of \$5,000, and income taxes. What is the firm's income tax liability?Hint: use the tax table to compute taxes.

Paper#48608 | Written in 18-Jul-2015

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