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Question
Marginal and average tax rates: Use the tax rate taken from Exhibit 11.6 to calculate the average tax rate for Lansing, Inc., this year. Lansing's pretax income was $275,000.(Round final answer to nearest whole percent.)
Exhibit 11.6 U.S. Corporate Tax Rate Schedule in 2007
Taxable Income
More
Than But Not More Than
Tax Owed
$0 $50,000 15% of amount beyond $0
$50,000 $75,000 $7,500 + 25% of amount beyond $50,000
$75,000 $100,000 $13,750 + 34% of amount beyond $75,000
$100,000 $335,000 $22,250 + 39% of amount beyond $100,000
$335,000 $10,000,000 $113,900 + 34% of amount beyond $335,000
$10,000,000 $15,000,000 $3,400,000 + 35% of amount beyond $10,000,000
$15,000,000 $18,333,333 $5,150,000 + 38% of amount beyond $15,000,000
$18,333,333 ------- 35% on all income
A) 8.0%
B) 25.0%
C) 32.9%
D) 39.0%
Answer
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