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Jabar Corporation. a C corporation. projects that It will have taxable income of 5265,000 bertha incurring any tease expenses. labia's tax rated 35 perceM Abdul, Jabars sole shareholder. has* marginal tax rate of 39 6 percent on owl nary moonily and 20 percent on dividend Mown Jabar always distributes all of its aftentax earrengs to Abdul.

•. Mai ts the amount of the overall tax (corporate loyal • shareholder woo on jab., Corp s 5265.000 protease evens. income 0 Jab., Corp disynbutes all of its after'411x aaaaaps to as solo sharehodcr. Abdul (include the 3.6% net investment income tax on editiond and rental income.)? (Input all answers as • positive number and round your answers to the nearest whole dollar.)

 

No lease payment

Taxable (income before lease payment

Lease payment

 

Taxable Income

 

Entity tax

 

After-tax entity earnings

 

Abduls tax on dividends

 

Abdurs lax on lease payment

 

Overall lax

3                        0

b. What Is the amount of the overall tax on Jabs. Carp d 5265 000 prthease expense Income later leases equipment from Abdul at a cost or 527 200 'or the year (etude the net investment income tax on dividend and rental Income )? (Input all answers as a positive number and round your answers to the nearest whole dollar.)

 

$27200 Lease
Deduction

Taxable income before lease payment

 

Lease Payment

 

Taxable income

 

Entity tax

 

After-tax entity earnings

 

Abdul's tax on &Mends

 

Abdurs tax on lease payment

 

Overall tax

$                  0:

c. What is the amount of the overall tax on Jabar Corp.'s $265,000 prelesse expense ir•come rfJabar Corp. leases equipment from Abdul at a cost of 827.200 for the year but the IRS determines that the fair market value at the lease payments is $19000 (include the net investmeM Income tax on dividend and rental income.)' (Input all answers ass positive number and round your answers to the nearest whole dollar.)

 

112,000 Lease
Deduction

taxable Income before lease payment

 

 

Lease payment

 

 

Taub% Income

 

 

Entity tax

 

 

After-tax entity earnings

 

 

Abdul's tax on dividends

 

 

Abudls tax on lease payment

 

 

i

iOverall tax

8

0'

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M91791604

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