Posted on 10/16/2008 4:54:29 PM PDT by goodnesswins
No, but I’m wiser.
this is HILARIOUS...and sad just the same!!
Right now my husband owns a small business with 2 employees and the gross is under 250K...
Why the HE** should we expand, hire, and place ourselves in a higher bracket so Obambi can share OUR WEALTH?
AAHGGGH...you’re right! Have to change that....
Question: If Obama increases taxes on businesses, what happens to the price of iPods, video games, clothes and the other things businesses make or sell? Who will pay those higher prices? Who does Obama really tax?
Answer: Prices will go up. Everyone who buys those things will pay the higher prices. Obama’s corporate tax hikes are tax increases on everyone, even if they make less than $250k per year, even if they’re 7th graders.
Thanks....that’s probably better than my attempt....I’ll use it!
Just an accounting review example for question #1.
Income Statement
Sales 2,000,000
Cost of Goods Sold 1,000,000
Gross Profit 1,000,000
Selling/Ad. Expense (Salaries, Incl. owner) 519,000
Depreciation Expense 200,000
Operating Income 281,000
Interest Expense 100,000
Earnings BEFORE Taxes 181,000
Taxes 63,350
Earnings After Taxes 117,650
Dividends to Shareholders 0
Retained Earnings 117,650
Just to correct question #1, the owner does not pay taxes until after he has deducted his operating expenses (overhead, cost of products sold, salaries to employees, salary to himself, depreciation of equipment, and interest on loans). So, he really only gets taxed on 181,000 of income, not the 2,000,000 of his gross sales. So, as long as he and none of his employees makes more than 250,000 during the year, then their taxes won’t increase.
I gave the owner a salary of 249,000, the workers 45,000, and taxed the Earn. before taxes at 35 percent. If the owner did not want to pay taxes twice, he could do one of the following:
1. Give himself a higher salary and then pay more in personal income taxes under Obama’s plan.
2. Increase his employee’s salaries (to roughly 77,000 each) so the company’s earnings would equal 0. Like option 1, this would leave no retained earnings for the company. Likely the owner would rather have the money for himself or his company rather than give it to his employees.
3. Minimize his tax payment by balancing salaries with company income. For example, he may find that taking a salary of 249,000 and then having the company pay 35 percent on 181,000 and keeping the retained earnings is cheaper than taking a salary of 430,000 for himself and leaving no money for the company to be taxed on.
I wrote this fast, so if my numbers are off or whatever, sorry, I was just trying to clarify the accounting to show that he doesn’t get taxed on the money that he pays to his employees. That is an expense that is written off before he pays taxes.
Do we know whether Obama’s tax is BEFORE expenses or AFTER????
Taxes come after expenses. That’s according to Generally Accepted Accounting Principles (GAAP) and is not subject to Obama’s influence unless he somehow becomes the singular dictator and changes the way the best accountants have been doing accounting since the Great Depression. As a matter of fact, GAAP came about because of the fraud in accounting prior to the G.D.. If GAAP changes, it is likely to be more strict, but expenses will never be taxed, it doesn’t make sense and Obama can’t change that.
Thanks....I really did KNOW that....but, in my hurry, didn’t remember.....That’s why I posted this - for FREEPERS to correct me...thanks again.
But, I just thought of something....7th Graders do NOT know that....LOL!!!
True. Unfortunately, neither do most adults. My wife got her B.A. and her Master’s without having to take a single economics or math class. The fact that she took over 200 undergrad/grad credit hours without a single math or basic econ class blows my mind (double major of music/art, master’s of secondary ed.). They should at least make these artist/music majors take some business classes so they can learn how to market their talents and run a business IMO.
And since at least 50 percent of voters think Obama’s tax plan is great, we know that at least 50 percent of adults don’t understand any business at all. Senator Government can finance his huge government programs by increasing income (taxes), debt financing (federal deficit), or cutting expenses (eliminate gov. programs). He has declared he can cut taxes, lower the federal deficit, and increase government spending all at the same time. This is impossible and preposterous, yet for some reason people believe him! We are in a sad state!
Hmmm. A guy on the radio said today that Obama’s jump from 36% to 39% in taxation rate for “Joe” was really 8.5%, I think he said, rather than only 3%. What am I missing here? Is that correct, and if so, I’m more tired than I thought.
Aside: Without the math classes, she didn’t get much science, either? No wonder the AGW/GCC scam is so easily perpetrated.
[Note: ~130 semester-hours, and no music courses. *<];-)]
8.3% increase in tax paid is correct. Increase in rate is 3%
Now: 36% on $100 = $36 tax paid
BHO: 39% on $100 = $39 tax paid
increase = 39-36 = $3 increase in dollars paid
$3/$36 X 100 = 8.333% increase in amount paid
Freshman biology and Physical Science were her two science classes. Neither require more than basic math.
That seems pretty typical any more.
To even qualify for admission when I graduated, we had to have three years English/literature (four recommended); math through Algebra II, with either 1 semester of trig or prob & stats, and 1 semester ‘elemetary’ functions recommended; 2 years of a foriegn language; 4 years of P.E., which meant dressing out nearly every day; 1 year each of general science, biology, & either chemistry or physics—both recommended. “Citizenship”; US history; world history; civics.
Didn’t leave much room for HS electives; BUT the state college & university system also required 2 years of college math; at least one each of a physical and a life science, at least one of which included a lab; and a lot of other general ed for any BS and most BA’s, though for a BA the math was only one year. For a science major, the general ed science classes didn’t count, but were extra.
The libs have watered it heavily, and have moved most requirements to the ‘soft side’ of the campus.
Students and young grads today are not prepared to effective refute the Gores and Hansons and Obamas of the world, let alone point and laugh them into oblivion.
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