Business, 14.11.2019 03:31 Hunter1471

Andrea would like to organize sho as either an llc (taxed as a sole proprietorship) or a c corporation. in either form, the entity is expected to generate an 11 percent annual before-tax return on a $200,000 investment. andrea’s marginal income tax rate is 35 percent and her tax rate on dividends and capital gains is 15 percent. andrea will also pay a 3.8 percent net investment income tax on dividends and capital gains she recognizes. if andrea organizes sho as an llc, andrea will be required to pay an additional 2.9 percent for self-employment tax and an additional 0.9 percent for the additional medicare tax. further, she is eligible to claim the full deduction for qualified business income. assume that sho will pay out all of its after-tax earnings every year as a dividend if it is formed as a c corporation.

a. how much cash after taxes would andrea receive from her investment in the first year if sho is organized as either an llc or a c corporation?

b. what is the overall tax rate on sho’s income in the first year if sho is organized as an llc or as a c corporation?

Answers: 2

Show answers

Another question on Business

Business, 22.06.2019 00:40

Guardian inc. is trying to develop an asset-financing plan. the firm has $450,000 in temporary current assets and $350,000 in permanent current assets. guardian also has $550,000 in fixed assets. assume a tax rate of 40 percent. a. construct two alternative financing plans for guardian. one of the plans should be conservative, with 70 percent of assets financed by long-term sources, and the other should be aggressive, with only 56.25 percent of assets financed by long-term sources. the current interest rate is 12 percent on long-term funds and 7 percent on short-term financing. compute the annual interest payments under each plan.

Answers: 3

Answer

Business, 22.06.2019 07:00

What is the state tax rate for a resident of arizona whose annual taxable income is $18,000?

Answers: 1

Answer

Business, 22.06.2019 07:30

1 2 3 4 5 6 7 8 9 10time remaining59: 30in the dark game, how does the author develop the central idea that elizabeth van lew was a spymaster during the civil war? 1 2 3 4 5 6 7 8 9 10time remaining59: 30in the dark game, how does the author develop the central idea that elizabeth van lew was a spymaster during the civil war?

Answers: 1

Answer

Business, 22.06.2019 10:30

Jack manufacturing company had beginning work in process inventory of $8,000. during the period, jack transferred $34,000 of raw materials to work in process. labor costs amounted to $41,000 and overhead amounted to $36,000. if the ending balance in work in process inventory was $12,000, what was the amount transferred to finished goods inventory?

Answers: 2

Answer

You know the right answer?

Andrea would like to organize sho as either an llc (taxed as a sole proprietorship) or a c corporati...

Questions