If each preferred shareholder pays the income tax of 33.33, Ask an Expert

Accounting

1) A for-profit hospital earns the gross profit of $10 million. Twenty-five percent (25%) of this net profit is retained earnings and another 30% is charged to corporate tax. If there are two 25% preferred shareholders and ten 10% ordinary shareholders, how much will each shareholder earn as dividend?

2) If each preferred shareholder pays the income tax of 33.33% on their dividend income, Compute their net dividend earning?

3) What is the retention ratio?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M910067

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