Question

Thrush Corporation, a calendar year C corporation, files it's 2018 Form 1120, which reports taxable income of $200,000 for the year. The corporation's tax is $61,250.

a. True
b. False

Answer 1

The statement is true. Thrush Corporation's taxable income of $200,000 results in a tax liability of $61,250 at a rate of 34%.

Step-by-step explanation:

The statement is true. The taxable income of Thrush Corporation is reported as $200,000 on its 2018 Form 1120. The tax liability of a C corporation is based on the taxable income and the applicable tax rate. In this case, Thrush Corporation's tax liability is calculated at a rate of 34% because its income falls within the bracket of $335,000 to $10,000,000, resulting in a tax amount of $61,250.