This is part of the hmk. reading in F6- Becker any explanation is appreciated. 

X Corp offers its sales vp a bonus = 10% of net income after deducting taxes but before deducting the bonus. Income without taxes or the bonus is $100,000 and tax rate 40%. Calculate the bonus:

1) Bonus =  10% (100,000-Taxes)

2) Taxes= 40% (100,000-Bonus)

Substitute ecuation 2)for Taxes in equation 1)

Bonus= 10% (100,000-40% (100,000-Bonus))

B= 10% (100,000-40%(100,000-B))

B=10%(100,000-40,000+40%B)

B=6,000+4%B

96% B=6000

B=6,000

:( what is this about?

Are you asking how to calculate the bonus?

I think of the following calculation.
(i) Net income after deducting taxes = 100k x (1-40%) = 60k
(ii) Bonus = 10% x Net Income after deducting taxes
               = 10% x 60K = 6K

siushan, the way you calculated its easier. The explanation I wrote is the one on the book and I did not understand.

You got the same result with a less scientific method.

Thank you :) I will copy this to the example. 

Thank you.