Marshall Mathers , a non-resident alien not engaged in trade or business, owns 1,000,000 shares in MWC, Inc. In 2021, MWC declared 20% stock dividends, during which the fair market value of the shares is P1/share. How much is the final tax on the dividends?

Marshall Mathers , a non-resident alien not engaged in trade or business, owns 1,000,000 shares in MWC, Inc. In 2021, MWC declared 20% stock dividends, during which the fair market value of the shares is P1/share. How much is the final tax on the dividends?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Hello, I need help solving this accounting problem.

A: TAX basis on 230 shares is (230 * $51) $11,730, After receiving 115 (230/2) , new stock on pro-rata…

Q: On January 1, 2022, Kinney, Inc., an S corporation, reports $32,800 of accumulated E & P and a…

A: Accumulated adjustments account (AAA): It refers to a corporation's account that tracks adjustments…

Q: A shareholder owns 45% of a S corporation stock for 175 days and 40% of the S corporation's stock…

A: The objective of the question is to calculate the shareholder's share of the ordinary income of the…

Q: B, a United States Shareholder, acquires its 70% interest in foreign corporation F’s shares on March…

A: Ownership of shares is the number of shares owned and determined by the company , It owns as…

Q: How much is the tax of Mr. RACH for the said transactions? 15,000 22,500 7,500 exempt

A: Capital gain is the gain that is earned by the company other than its business activities. The…

Q: Turner Company owns 50% of the outstanding stock of ICA Company. During the current year, ICA paid a…

A: The objective of the question is to understand the impact of the dividend paid by ICA Company on the…

Q: Eagle Corporation, a calendar year C corporation owns stock in Hawk Corporation and has taxable…

A: As per TCJA, special deduction includes DRD (Dividend received deduction) 50% DRD for dividends from…

Q: Tic Ling sold 1,000 shares directly to the stock market for P 1,000,000. How much is the percentage…

A: Solution Provision applicable Percentage tax When the share is sold /disposed through…

Q: 8. A. an individual, owns all 100 shares of X Co. A's basis in these shares is S1 per share (S100…

A: Financial Management: Financial management comprises of two words i.e. Finance and management.…

Q: a. $2,000.

A: Solutions 1) The correct option is a) $2000 Detailed explanation are as fallows: Receipt of cash…

Q: , King is a stockholder of Ara Corporation, In 2018, he received as dividend from the latter 150…

A: Stock Dividend describes the dividend payment made to shareholders in form of own company's shares…

Q: Exercise 19-27 (Algorithmic) (LO. 7) What are the tax consequences to Euclid from the following…

A: Provisions of section 305 are based on the equivalent interest concept in its current state. As per…

Q: pte Mr. Neis, a resident alien, owns 40% of the shares of Coco Corporation, a resident corporation.…

A: Cash dividends received by an individual who is a resident alien of the Philippines are subject to a…

Q: Dahlia is in the 32 percent tax rate bracket and has purchased the following shares of Microsoft…

A: The capital gain refers to the excess of realization value over the acquisition price. It is…

Q: Alpha Company uses the owns a 30% investment in Bravo's common stock. During 2021, Bravo reported…

A: The question is related to investment in Associates. The details are given regarding the same.

Q: My question is would Horace's tax liability on the $5000 gain on the sale of stock as ordinary…

A: Capital Gain Taxes According to Internal Revenue Service (IRS) there are two types of Capital gain…

Q: During the year 2021, David Company purchased 1,000 shares of Goliath Company ordinary shares at…

A: The calculation of holding gain that should David report in equity on December 31 is shown hereunder…

Q: Mr. Chua sold shares of stocks of a resident foreign corporation directly to a buyer. The shares…

A: Capital gain means the gain that is earned by assets, stock, and real estate property. In the stock,…

Q: On October 1, 2020, Miya owns 15,000 fair value through other comprehensive income shares acquired…

A: The amount to be recorded as dividend income in 2020 is option (d) i.e. 66000

Q: Helen owns 12% of the stock of the Median Corporation. If Median makes a dividend payment of…

A: Calculate the total value of Helen's ownership:Multiply Helen's ownership percentage by the total…

Q: oblem 19-34 (Algorithmic) (LO. 1, 4) the start of the current year, Blue Corporation (a calendar…

A: Pooja and John has equal share in Blue Corporation. The income from profit of business would not be…

Q: X owns 20% of the stocks of Y Corporation. X and Y are both domestic corporations. Y declared…

A: X owns 20% of the stocks of Y corporation Y declared P 120000

Q: Jumper, Incorporated, which has a 21 percent tax rate, owns 40 percent of the stock of a CFC. At the…

A: It is the payment or allowance made to the participant or shareholders of a company which is not…

Q: Mahan purchases 1,000 shares of Bluebird Corporation stock on October 3, 2022, for $400,000. On…

A: A recognized gain is the profit you make from selling an assets. it can calculate the recognized…

Q: Wendell owns 100% of the outstanding stock of Group Corporation. During the current year, Wendell…

A: Issuance of stock in exchange for property (non-taxable @NBV) Non-taxable transaction under…

Q: Leila owns 14% of the ordinary share of Datafarm Ltd. Assume dividends from Datafarm is the only…

A: Percentage shares held by Leila=14% Net profits (after Tax) for the year 2019=$1,000,000 Dividend…

Q: 1. Ian holds 100 shares in Big Bank Pty Ltd. The company paid a fully franked dividend of $4 per…

A: Solution note Dear student as per the Q&A guideline we are required to answer the first question…

Q: Corporation A owns 70% of all classes of stock in Corporation B throughout 2021. Corporations A and…

A: DRD stands for "Dividends Received Deduction." It is a tax deduction that allows corporations to…

Q: On May 17, 2021 (!), Apple’s stock is selling for $100/share, and it declares a dividend of $5/share…

A: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question and…

Q: Ku Jung owns all of the shares of Jay Ltd. The ACB of the shares is $5,000. He has decided to…

A: As per 88(2) states that where it does apply, a dividend paid on a winding-up will not be a taxable…

Q: USA Corp, a calendar year domestic corporation, owns 30 percent of the stock of XYZ Corp, a calendar…

A: SOLUTION : As per Tax cuts and jobs act, there is deemed tax liability on unrepatriated…

Q: a. If the payment qualifies for stock redemption sale or exchange treatment, the tax liability for a…

A: Capital gains are the rising worth of an investment that makes its current value higher than when it…

Q: In computing the personal holding company tax of Southerland in 2022, what is the amount of…

A: The question is asking for the calculation of the dividends paid deduction for Southerland…

Q: X Corp. (a C corporation) distributes Whiteacre to shareholders all of whom have held their shares…

A: It is a type of corporation, that is taxed separately under Subchapter C of Chapter 1 of the…

Q: Thora B., a taxpayer, has the following data for taxable year 2019: Capital stock issued and…

A: The appreciation in a capital asset's value at the moment of sale is known as a capital gain. All…

Q: A resident company that has a corporate tax rate for imputation purposes of 30% pays a $8500…

A: The following calculations are done for the resident company.

Q: In 2023, Unlimited Tech had net operating income of $7,613,386. In addition to their operating…

A: It is the income of a taxpayer on which the revenue authorities will impose tax. The taxable income…

Q: Turner Company owns 10% of the outstanding stock of ICA Company. During the current year, ICA paid a…

A: Turner Company owns 10% of the outstanding shares of ICA Company.Turner lacks substantial control…

Question

A.PO
B.P20,000
C.P50,000
D.P40,000

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Frank is a director of Otago Pty Ltd (Otago), an Australian resident private company, with a corporate tax rate for imputation purposes for the 2020/21 income year of 30%. Frank provided you with the following information regarding the company’s franking account: 1 July 2020: Opening balance $500 credit. 29 July 2020: Paid 2020 tax year fully franked final dividend $7,000 28 February 2021: Paid 2021 tax year 60% franked interim dividend $9,000 30 April 2021: Received fully franked dividend from Australian company $4,500 28 June 2021: PAYG instalment paid relating 2020/21 tax year totalled $1,200 30 June 2021: Declared a fully franked dividend of $10,000 Otago had a taxable income of $16,000 for 2020/21. Required 1) Prepare Otago Pty Ltd’s franking account for the 2020/21 tax year and explain any consequences arising from the franking account balance at 30 June 2021. 2) Calculate net tax payable (refundable) for the company.
Foley Corporation (a C corporation subject to a 21% income tax rate) has 2 shareholders: Wang Corporation (a C corporation which owns 20% of the stock) and Anthony (a single individual who owns 80% of the stock). Anthony's basis for his stock is $80,000 and Wang Corporation's basis for its stock is $20,000. Foley Corp. has $226,000 current E&P and $45,000 accumulated E&P before adjusting for the following. During the year Foley Corp. distributed property (with a fair market value of $240,000 and adjusted basis of $125,000) to Anthony On the same day, Foley Corp. also made a distribution to Wang Corporation of property (with a fair market value of $95,000 and adjusted basis of $50,000). Wang Corporation also assumed a $35,000 liability on this property. These were the only distributions this year by Foley Corporation. How much total gain does Foley Corporation recognize as a result of the distributions? OA. Zero OB. $160,000 OC. $126,400 OD. $125,000
Deli Corporation (an S Corporation) is owned 100% by individual A. Deli earns business income of $40,000 in year one and distributes $30,000 to A in December of year one. What is A’s basis in the X stock at December 31 assuming A’s initial basis was $10,000?
Tall Corporation (an S-corporation) has AAA of $16,000 and AEP of $8,000 .Tall Corp. distributes $20,000 of cash to its Henry, the sole shareholder. Henry's basis in his S Corp stock before the distribution is $40,000. Henry is in the 37% tax bracket. 1. What are the tax consequences to Henry as a result of this distribution? 2. What is ending balance in AAA and AEP. What is Henry's ending stock basis?
The John and John Corporation has ordinary income of $250,000 for 2021, including dividends of $50,000 received from 90%-owned domestic corporations. How much is the Johnson and Johnson corporation’s dividends received deduction for 2021? $0 $40,000 $50,000 $170,000
Hawkeye Company reports current E&P of $300,000 this year and accumulated E&P at the beginning of the year of $200,000. Hawkeye distributed $400,000 to its sole shareholder, Ray Kinsella, on December 31 of this year. Ray's tax basis in his Hawkeye stock before the distribution is $75,000. b. What is Ray's tax basis in his Hawkeye stock after the distribution? Tax basis
Alex purchased $5000 worth of shares in a small biotech company on 1 September 2019. At 31 December 2019, the company declared and paid an interim dividend of $700 which was unfranked. What amount must Alex include in his assessable income for the 2020 year as ordinary or statutory income? a. $700 b. None of the above. c. $5,000 d. $1,000
Ian holds 100 shares in Big Bank Pty Ltd. The company paid a partially franked dividend of $4 per share (franked to 30%) on 1 June. Assume a corporate tax rate of 30%. How much tax (if any) must Ian pay on the dividend income? Assume his applicable marginal tax rate is 45% and this is the only transaction. a. $160 b. Nil c. $151 d. $57
viking corporation is owned equally by Sven and his wife Olga, each of whom hold 100 shares in the company. Viking redeemed 60 shares of Sven's stock for $1,700 per share on December 31, 20x3. Viking has total E&P of $430,000. What are the tax consequences to Viking because of the stock redemption? Multiple Choice ___ No reduction in E&P because of the exchange. ___ A reduction of $102,000 in E&P because of the exchange. ___ A reduction of $129,000 in E&P because of the exchange. ___ A reduction of $258,000 in E&P because of the exchange.
2. T corporation (e & p $800,000) has 1,000 shares of stock outstanding. The shares are owned as followed: james 600 shares; stephanie (james sister) 300 shares; luke (james son) 100 shares. T corporation owns land (basis of $300,000, fmv of $260,000) that it purchased as an investment 10 years ago. James had a basis of $275,000 in his shares. What are the tax consequences for both t cororation and james if the distribution is: a qualified stock redemption? b. liquidating distribution?
1
You’re a 40% shareholder of ABC, Inc., an S corporation. ABC’s ordinary busi-ness income for 2019 was exactly $100,000. ABC distributed $20,000 to you in your capacity as a shareholder during 2019. On your 2019 Form 1040, you will report ___ of gross income from ABC. Why is that the correct amount plzzz ans asap.....