Toni’s typesetters is analyzing a possible merger with Petes print shop, Toni has a tax loss carry forward of 200,000 which it could apply to Petes expected earnings before taxes of 100,000 per year for the next 5 years. Using 34% tax rate compare earnings after taxes for Petes over the next years both with and without the merger.

Answer rating: 100% (QA)

With Merger Year Cash flow Tax loss adjusted Profit before tax Tax 34 Earnings after tax 1 100... View the full answer