Difference between revisions of "Feldblum.Surplus - Challenge 02"
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(Created page with "{| class='wikitable' |- | <span style="color: red;">'''Solved!'''</span> Shout-out to Mark Maenche! ''(Apr 6-2019, in 12 hrs, 47 mins after posting)''. |} * tax rate that ma...") |
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| + | There was an error in the problem so the submitted answers had to be corrected. This was not the fault of the submitters so I have kept their shout-outs intact but have updated the answers to be consistent with the current version of the problem. | ||
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{| class='wikitable' | {| class='wikitable' | ||
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| − | * tax rate that makes the decision between liquidation and continued operations irrelevant: ''' | + | * tax rate that makes the decision between liquidation and continued operations irrelevant: '''37.0%''' |
| − | : ==> solve for <u>tax</u>: (invested capital) = (original pre-tax income) ⋅ (1 - tax) / (% CoC) | + | : ==> solve for <u>tax</u>: (invested capital - CoL) = (original pre-tax income) ⋅ (1 - tax) / (% CoC) |
| − | : ==> 292.5 = 50 ⋅ (1 - tax) / 0.12 | + | : ==> (292.5 - 30) = 50 ⋅ (1 - tax) / 0.12 |
| − | : ==> tax = <u> | + | : ==> tax = <u>37.0</u>% |
| − | * pre-tax income that makes the decision between liquidation and continued operations irrelevant: ''' | + | * pre-tax income that makes the decision between liquidation and continued operations irrelevant: '''48.462''' |
| − | : = (invested capital) / | + | : = (invested capital - CoL) * CoC / (1 - %tax) |
| − | : = 292.5 / | + | : = (292.5 - 30) * 0.12 / (1- %tax) |
| − | : = <u> | + | : = <u>48.462</u> |
{| class='wikitable' | {| class='wikitable' | ||
Revision as of 02:51, 19 April 2019
There was an error in the problem so the submitted answers had to be corrected. This was not the fault of the submitters so I have kept their shout-outs intact but have updated the answers to be consistent with the current version of the problem.
| Solved! Shout-out to Mark Maenche! (Apr 6-2019, in 12 hrs, 47 mins after posting). |
- tax rate that makes the decision between liquidation and continued operations irrelevant: 37.0%
- ==> solve for tax: (invested capital - CoL) = (original pre-tax income) ⋅ (1 - tax) / (% CoC)
- ==> (292.5 - 30) = 50 ⋅ (1 - tax) / 0.12
- ==> tax = 37.0%
- pre-tax income that makes the decision between liquidation and continued operations irrelevant: 48.462
- = (invested capital - CoL) * CoC / (1 - %tax)
- = (292.5 - 30) * 0.12 / (1- %tax)
- = 48.462
| Honorable Mention! Chris B. (Apr 6-2019, in 19 hrs, 9 mins after posting). |
