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Komiko tanaka invests 12000 in lymabean inc lymabean does

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Komiko Tanaka invests $12,000 in LymaBean Inc. LymaBean does not pay any dividends. Komiko projects that her investment will generate a 10 percent before-tax rate of return. She plans to invest for the long term. (Do not round intermediate calculations. Round "After-tax rate of return" to 2 decimal places and other answers to the nearest whole dollar amount.)

a-f.

Calculate how much cash will Komiko retain, after taxes, if she holds the investment for

(1) 5 years and sells it when the long-term capital gains rate is 15 percent.

(2) 5 years and sells it when the long-term capital gains rate is 25 percent.

(3) 15 years and sells it when the long-term capital gains rate is 15 percent.



Also, calculate Komiko's after-tax rate of return on her investment in (1), (2) and (3)?


 investment per=5 yr; LT Cap Gain rate =15% Invest per=5 yr; LT cap gain rate = 25% investper=15yr;LTcapgainrate=15%
Proceedfromsale


basis in shares


gain realized on sale


tax rate on gain 15% 25% 15%
tax on gain


cash retained after taxes


after tax rate of retrun % % %

Reference no: EM13576362

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