Finance Essay

(2-6) Statement of Retained Earnings In its most recent mo authorizeary statements, Newhouse Inc. reported $50 one thousand thousand of fire income and $810 one thousand thousand of protect gelt. The previous carry earnings were $780 cardinal. How much in dividends was yield to sh areholders during the year? Dividend paid = preceding Balance retained earning + net income - New Balance retained earning Dividend = $780 million + $50 million - $810 million= $830 million - $810 million= $20 million (2-7) Corpo outrank revenue revenue income liability The T everyey mess had a evaluateable income of $365,000 from operations after each(prenominal) operating costs but before (1) interest charges of $50,000, (2) dividends legalise of $15,000, (3) dividends paid of $25,000, and (4) income valuees. What are the buckrams income tax fiscal obligation and its after-tax income? What are the gilds marginal and just tax judge on taxable income? After-tax income = 365,000-50,000+4500=319,500 Talleys tax income Liability: nonexempt in operation(p) Income --- $365,000 dutiable Interest --- ($50,000) Taxable Dividend $4,500... Tax = $22,250 + ($319,500 - $100,000)(0.39) = $22,250 + $85,605 = $107,855. Tax = $107,855 After-tax income: Taxable income $319,500 Taxes -$107,855 Plus Non-taxable dividends $10,500 Net income $222,145 Non-taxable dividends: $15,000 x 0.7 = $10,500.

marginal tax crop is 39%. average tax set out is $107,855/$319,500 = 33.76%. (2-9) Corporate After-Tax Yield The Shrieves Corporation has $10,000 that it plans to invest in saleable securities. It is choosing among AT&T bonds, which open 7.5%, state of Florida muni bonds, which yield 5% (but are not taxable), and AT&T preferred stock, with a dividend yield of 6%. Shrievess corporate tax rate is 35%, and 70% of the dividends genuine are tax exempt. stimulate the after-tax rank of return on all three securities. A T & T Bonds 10,000 X 7.5%= $750 $750 X .35 = $262.50 $750 -262.50 = $487.50 $487.50/$10,000=4.875% After tax rates=4.875% A T & T Preferred Stock...If you destiny to take a soil a full essay, set it on our website: Ordercustompaper.com

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