An S corporation earns $6.30 per share before taxes. The corporate tax rate is 35%, the personal tax rate ondividends is 20%, and the personal tax rate on non-dividend income is 39%. What is the total amount of taxes paidif the company pays a $3.00 dividend?A. $1.97B. $2.95C. $3.44D. $2.46OC

In S corporation the income is directly transferred to the shareholders of the company and there is…

Answered: An S corporation earns $6.30 per share…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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QUESTION 1 "Consider a C corporation. The corporation earns $4 per share before taxes. After the corporation has paid its corresponding taxes, it will distribute 50% of its earnings to its shareholders as a dividend. The corporate tax rate is 30%, the tax rate on dividend income is 20%, and the personal income tax rate is set at 28%. What are the shareholder's earnings from the corporation after all corresponding taxes are paid? Note: Express your answers in strictly numerical terms. For example, if the answer is 5%, enter 0.05 as an answer; or if the answer is $500, write enter 500 as an answer."
1. Tommy’s Woodworking had sales of $4 million this past year. Its COGS was $2.75 million and its operating expenses were $800,000. Interest expenses on outstanding debt were $200,000 and the company paid $40,000 in stock dividends. Its tax rate is 35%. What was the company’s taxable income (EBT) and tax liability (tax expense)?
The tax rates are as shown below: Taxable Income Tax Rate $ 0 - 50,000 15 % 50,001 - 75,000 25 % 75,001 - 100,000 34 % 100,001 - 335, 000 39 % Your firm currently has taxable income of $81,600. How much additional tax will you owe if you increase your taxable income by $22, 800 ?
8. What is the after-tax return to a corporation that buys a share of preferred stock at $45, sells it at year-end at $45, and receives a $5 year-end dividend? The firm is in the 20% tax bracket. Revenue = $5 For a company, taxable = $5 * 30% = $1.5 Tax = $1.5* 20% = $0.3 After tax income = $5 - $0.3= $4.7 Return $4.7/$45= 10.44%
6
↑ You are a shareholder in a C corporation. The corporation earns $2.05 per share before taxes. Once it has paid taxes it will distribute the rest of its earnings to you as a dividend Assume the corporate tax rate is 25% and the personal tax rate on all income is 20% How much is left for you after all taxes are paid? The amount that remains is $ per share. (Round to the nearest cent.)
Subject Finance
You are a shareholder in a "S" corporation. This corporation earns $4 per share before taxes. After it has paid taxes, it will distribute the remainder of its earnings to you as a dividend. The dividend is income to you, so you will then pay taxes on these earnings. The corporate tax rate is 21% and your tax rate on dividend income is 15%. The effective tax rate on your share of the corporations' earnings is closest to: WHEELSTE • 15% O 21% О 28% O 33% • 36%

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An S corporation earns $6.30 per share before taxes. The corporate tax rate is 35%, the personal tax rate on dividends is 20%, and the personal tax rate on non-dividend income is 39%. What is the total amount of taxes paid if the company pays a $3.00 dividend?