Principles Of Taxation For Business And Investment Planning 2020 Edition
23rd Edition
ISBN: 9781259969546
Author: Sally Jones, Shelley C. Rhoades-Catanach, Sandra R Callaghan
Publisher: McGraw-Hill Education
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Question
Chapter 12, Problem 12AP
a.
To determine
Calculate the combined tax cost for Mr. P and Mr. Q.
b.
To determine
Calculate the combined tax cost for Mr. P and Mr. Q, if the interest on the shareholder debt was $162,000 and there is no dividend for PQ.
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Students have asked these similar questions
Ms. Xie, who is in the 37 percent tax bracket, is the sole shareholder and president of Xenon. The corporation's financial records show the following:
Gross income from sales of goods: 1,590,000
Operating expenses: (930,000)
Salary paid to Ms. Xie: (300,000)
Dividend distributions: (200,000)
Required:
a. Compute the combined tax cost for Xenon and Ms. Xie. (Ignore payroll tax.)
b. How would your computation change if Ms. Xie's salary was $500,000 and Xenon paid no dividends?
Ms. Xie, who is in the 37 percent tax bracket, is the sole shareholder and president of Xenon. The corporation's financial records show
the following:
Gross income from sales of goods
Operating expenses
$1,590,000
(930,000)
(300,000)
(200,000)
Salary paid to Ms. Xie
Dividend distributions
a. Compute the combined tax cost for Xenon and Ms. Xie. (Ignore payroll tax.)
b. How would your computation change if Ms. Xie's salary was $500,000 and Xenon paid no dividends?
Answer is not complete.
Complete this question by entering your answers in the tabs below.
Required A
Required B
Compute the combined tax cost for Xenon and Ms. Xie. (Ignore payroll tax.)
Xenon's tax
$
360,000 X
Ms. Xie's tax on salary
111.000✔
Ms. Xie's tax on dividend
40.000 ✓
Total income tax cost
511,000
Ms. Xie, who is in the 37 percent tax bracket, is the sole shareholder and president of Xenon. The corporation's financial records show the following:
Gross income from sales of goods
Operating expenses
Salary paid to Ms. Xie
Dividend distributions
$ 1,590, 000
(930,000 )
(300,000)
(200,000)
Required:
a. Compute the combined tax cost for Xenon and Ms. Xie. (Ignore payroll tax.)
b. How would your computation change if Ms. Xie's salary was $500,000 and Xenon paid no dividends?
For Requirement A, what is Xenon’s tax?
For Requirement B, What is Xenon’s tax?
Chapter 12 Solutions
Principles Of Taxation For Business And Investment Planning 2020 Edition
Ch. 12 - Mr. and Mrs. Velotta are self-employed...Ch. 12 - Prob. 2QPDCh. 12 - Ms. Johnson is eager to create a family...Ch. 12 - Discuss the tax and nontax reasons why the stock...Ch. 12 - Mr. Eros operates an antique store located on the...Ch. 12 - Prob. 6QPDCh. 12 - Prob. 7QPDCh. 12 - Prob. 8QPDCh. 12 - Prob. 9QPDCh. 12 - Prob. 10QPD
Ch. 12 - Prob. 11QPDCh. 12 - Ms. Knox recently loaned 20,000 to her closely...Ch. 12 - Explain the logic of the tax rate for both the...Ch. 12 - Prob. 14QPDCh. 12 - Prob. 15QPDCh. 12 - Prob. 16QPDCh. 12 - Mr. Tuck and Ms. Under organized a new business as...Ch. 12 - Grant and Marvin organized a new business as a...Ch. 12 - Prob. 3APCh. 12 - Ms. Kona owns a 10 percent interest in Carlton...Ch. 12 - Mrs. Franklin, who is in the 37 percent tax...Ch. 12 - Prob. 6APCh. 12 - Prob. 7APCh. 12 - Prob. 8APCh. 12 - Prob. 9APCh. 12 - Prob. 10APCh. 12 - Prob. 11APCh. 12 - Prob. 12APCh. 12 - Prob. 13APCh. 12 - Ms. Xie, who is in the 37 percent tax bracket, is...Ch. 12 - Prob. 15APCh. 12 - In 1994, Mr. and Mrs. Adams formed ADC by...Ch. 12 - Prob. 17APCh. 12 - Prob. 18APCh. 12 - Prob. 19APCh. 12 - Prob. 20APCh. 12 - Prob. 21APCh. 12 - Prob. 1IRPCh. 12 - Prob. 2IRPCh. 12 - Prob. 3IRPCh. 12 - REW Inc. is closely held by six members of the REW...Ch. 12 - Prob. 5IRPCh. 12 - Prob. 6IRPCh. 12 - Prob. 7IRPCh. 12 - Prob. 8IRPCh. 12 - Prob. 9IRPCh. 12 - Prob. 10IRPCh. 12 - Prob. 2TPCCh. 12 - Prob. 3TPC
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