Compute the value of the preferential rate to Mr. L.

Compare and contrast product and process research.
December 24, 2020
Recommend to management the manner in which they can improve each of the three (3) ratios identified.
December 24, 2020

At the beginning of the year, Mr. L put $50,000 cash into Investment X. At the end of the year, he received a check for $2,800, representing his annual return on the investment. Mr. L’s marginal tax rate on ordinary income is 39.6 percent. However, his return on Investment X is a capital gain taxed at 20 percent. Compute the value of the preferential rate to Mr. L.