Based Only on the Information Provided for Each Scenario, Determine

question 119

Essay

Based only on the information provided for each scenario, determine whether Kristi or Cindy will benefit more from using the timing strategy and why there will be a benefit to that person. Use Exhibit 3.1. (Round discount factor(s)to three decimal places.)
a. Kristi has a 40 percent tax rate and can defer $20,000 of income. Cindy has a 30 percent tax rate and can defer $30,000 of income. b. Kristy has a 30 percent tax rate and a 10 percent after-tax rate of return and can defer $25,000 of income for three years. Cindy has a 40 percent tax rate and an 8 percent after-tax rate of return and can defer $20,000 of income for four years..

---

Definitions:

Routine Reply

A standard or customary response given to frequently asked questions or common situations.

Direct Approach

A communication strategy that involves stating the main point or purpose at the beginning of the message.

Routine Message

A standard or typical communication sent in the regular course of business or personal affairs.

Negative Information

Data or facts that may be unfavorable or detrimental to an individual's or organization's image or objectives.