The following information is available to the Kessler Company after its first year of operations:

Income before taxes $250,000

Federal income tax due $104,000

Deferred Income Tax (4,000 )

Income from tax expenses 100,000

Net Income $150,000

Kessler estimates his annual warranty expense as a percentage of sales. The amount charged to warranty expense on his books was $105,000. Assuming a 40% income tax rate, how much was actually paid this year for warranty claims?

Answer rating: 100% (QA)

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