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The following information relates to Franklin Freightways for its first year of operations (data in millions of dollars):
| | | | |
| Pretax accounting income: | $ | 150 | |
| Pretax accounting income included: | | | |
| Overweight fines (not deductible for tax purposes) | | 5 | |
| Depreciation expense | | 65 | |
| Depreciation in the tax return using MACRS: | | 112 | |
| |
The applicable tax rate is 38%. There are no other temporary or permanent differences. Franklin's taxable income ($ in millions) is:
Multiple Choice
$108.
$47.
$112.
$103.
Answer & Explanation
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