Income Tax Assignment | Homework For You
The following information is from Robin Hood Inc.
| Advertising Expenses | $ (400,000) | |
| Capital Gains | $ 150,000 | |
| Capital Losses (this year) | $ (200,000) | |
| Capital Losses (prior year) | $ – | |
| Cost of Goods Sold | $ (4,000,000) | |
| Dividend “A” income | $ 200,000 | |
| Dividend “B” income | $ 100,000 | |
| Dividend “C” income | $ 50,000 | |
| General and Admin Expenses | $ (1,300,000) | |
| Interest Expense | $ (500,000) | |
| Sales | $9,000,000 |
1) In addition, Robin purchased equipment at the beginning of the year for $750,000. The equipment has a useful life and a salvage value of 14 years and $50,000 respectively.
2) Robin Hood Inc. has varying ownership interest in the 3 companies listed below and receives dividend income from each company.
Robin owns 15% of Company “A”
Robin owns 45% of Company “B”
Robin owns 90% of Company “C”
3)How much of Robin’s capital gains are taxable?
4)Calculate Robin’s interest expense deduction assuming the following:
Adjusted taxable income $ 35,000,000
Business interest income $ 1,000,000
Business interest expense $ 15,000,000
5)How much of the dividend income is taxable?
6)Assuming taxable income is $3,500,000, calculate Robin’s tax liability.Get Finance homework help today
