Webster, Inc. has the following items of items of income and expense for 2016, it first year of operations. Webster began operations on April 1 and uses a calendar year end.

Gross receipts from sales - $1,391,222

Charitable contributions - 15,000

Employment taxes - 10,250

Interest expense - 30,000

Organizational costs - 52,600

Office rent expense - 31,000

Real estate taxes - 15,600

Utilities expense - 11,300

Wage expense - 9,3540

In addition to these items, Webster purchased machinery and equipment costing $1,430,000 and furniture costing $112,000 on April 9, 2016, and a warehouse costing $190,000 on May 2, 2016. Webster wants to minimize its 2016 income tax liability, which means electing section 179 expense for the maximum the tax law allows, as well as taking the 50% bonus depreciation. Compute Webster's 2016 taxable income and income tax liability.

Answer rating: 100% (QA)

To compute Websters 2016 taxable income and income tax liability we would need to take into account ... View the full answer