Yoda's Training Camp Inc. had $122,500 in operating income. Yoda's Training Camp Inc., had interest income of $25,000 and earned $70,000 in dividend income. Yoda's Training Camp Inc. had an interest expense of $40,000. Using the corporate tax schedule below, what is Yoda's tax liability?

taxable income	Support Base Tax	Percentage of Excess over Base
Up to $50,000	$0	15%
$50,000-$75,000	7,500	25
$75,000-$100,000	13,750	34
$100,000-$335,000	22,250	39
$335,000-$10,000,000	113,900	34
$10,000,000-$15,000,000	3,400,000	35
$15,000,000-$18,333,333	5,150,000	38
More than $18,333,333	6,416,667	35

Assume a 70% dividend exclusion for dividend tax.

Answer rating: 100% (QA)

Answer Firstly find taxable income as below Taxable income Operating ... View the full answer