Use the Information for the Question(s) Below

question 5

Multiple Choice

Use the information for the question(s) below.
Consider the following tax rates:
*The current tax rates are set to expire in 2008 unless Congress extends them. The tax rates shown are for financial assets held for one year. For assets held less than one year, capital gains are taxed at the ordinary income tax rate (currently 35% for the highest bracket) ; the same is true for dividends if the assets are held for less than 61 days.
-In 2006,Luther Incorporated paid a special dividend of $5 per share for the 100 million shares outstanding.If Luther has instead retained that cash permanently and invested it into treasury bills earning 6%,then the present value of the additional taxes paid by Luther would be closest to:

• A) $35 million
• B) $290 million
• C) $175 million
• D) $585 million

Recognize the significance of ethics in financial reporting and accounting practices.

Understand the importance and duties of different external users including labor unions, potential employees, and taxing authorities.

Recognize the elements of financial statements and their importance to business operations.

Understand the concept of assets, liabilities, and shareholders' equity and their significance in accounting.

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Definitions:

Organizational Culture

The collection of values, expectations, and practices that guide and inform the actions of all team members within an organization.

Competitive Atmosphere

An environment characterized by rivalry among individuals or organizations striving for the same objective, such as a market or sector.

Experimental Science

A scientific discipline that relies on controlled experiments to investigate the relationships between variables.

Culture

The shared attitudes, values, norms, practices, languages, and artifacts that characterize a group of people.