Corporation Growth has $83,000 in taxable income, and Corporation Income has $8,300,000 in taxable income. (Refer to Table 2.3)

What is the tax bill for each firm? Suppose both firms have identified a new project that will increase taxable income by $10,000. How much in additional taxes will each firm pay? Why is this amount the same?

Table 2.3

Taxable Income Tax Rate 0 50,000 50,001- 75,000 75,001100,000 100,001- 335,000 335,001-10,000,000 10,000,001-15,000,000 15,000,001-18,333,333 15% 25 34 39 34 35 38 35 18,333,334+