Reed Corporation reports 2017 sales of $415 million, income before income taxes of $122.3 million and tax expense of $35.9 million.

If sales are projected to increase by 4% next year, projected tax expense for 2018 will be:

A. $35.9 million

B. $37.3 million

C. $40.8 million

D. $42.3 million

E. There is not enough information to determine the amount.

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2 May, 00:51

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Porter Fry · Answer 1

B. $37.3 million

35.9 million * 4% = 1.436 million

= 35.9 + 1.436

= $37.336 million or $37.3 million