In the First Two Years of Operations,a Company Reports Taxable

question 77

Essay

In the first two years of operations,a company reports taxable income of $125,000 and $65,000,respectively.In the first two years,the company paid $50,000 and $13,000.It is now the end of the third year,and the company has a loss of $160,000 for tax purposes.The company carries losses to the earliest year possible.The tax rate is currently 25%.
Requirement:
Compute the amount of income tax payable or receivable in the current (third)year.

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Definitions:

Intercorrelation

A statistical correlation between two or more variables or sets of data.

Simple Regression Analysis

Simple Regression Analysis is a statistical technique for estimating the relationship between a dependent variable and a single independent variable.

Simple Correlation Analysis

A statistical technique that measures the strength and direction of a linear relationship between two continuous variables.

Multiple Correlation Analysis

A statistical method used to understand the relationship between one dependent variable and two or more independent variables.