Trish Foods, Inc. had pretax ordinary corporate income during 2009 of $2.7 million. In addition during the year, Trish sold a group of non-depreciable business assets (in the 5-year depreciation class) that it had purchased new for $980,000 three years earlier. Because the assets were not depreciable, their book value at the time of sale was also $980,000. The firm pays corporate income taxes at the rates shown in text Table.

a. Calculate Trish€™s 2009 tax liability, average tax rate, and marginal tax rate, assuming the group of assets was sold for $1,150,000
b. Calculate Trish€™s 2009 tax liability, average tax rate, and marginal tax rate, assuming the group of assets was sold for $890,000.
c. Compare, contrast, and discuss your findings in parts a.) and b.).

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Taxable Income Over Not Over Tax Rate 50,000 75,000 100,000 335,000 10,000,000 15,000,000 18,333,333 50,000 75,000 100,000 335,000 10,000,000 15,000,000 18,333,333 15% 25% 34% 3990 34% 35% 3896 35%