Question

Suppose an investment generates an annual sales of $5,700.000, with annual costs of $4.320.000. If the tax to be paid on annual sales is $414,000, what is a tax rate?

Multiple Choice
0%
10%
20%
30%

Answer 1

With 5,700,000 in total sales with costs of 4,320,000 you have 1,380,000 in taxable income. If the total tax due is 414,000, this would mean a 30% tax rate.

414,000 is 30% of 1,380,000