A Company has an estimated annual tax rate of 42 percent in the first quarter of 2016. Pretax income for the first quarter was $800,000. At the end of the second quarter of 2016, A Company. expects the annual tax rate to be 38 percent because of anticipated tax credits. Pretax income for the second quarter was $750,000.
How much income tax expense is recognized in the first quarter of 2016? Show all work in support of your answer!
How much income tax expense is recognized in the second quarter of 2016? Show all work in support of your answer!
Assume A Company's estimate for annual corporate income tax in now 40%. Pre tax income for the third quarter was $900,000. Compute A Company's income tax expense for the third quarter.
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