Jerry and Matt Decide to Form a Business

question 108

Multiple Choice

Jerry and Matt decide to form a business. Jerry will contribute $4,200 for a 35% interest and Matt will contribute $7,800 for a 65% interest. The business will take out a $25,000 loan to cover the balance of their working capital needs. They expect that the business will have a loss of $38,000 for the first year. In the second year, the business will have a profit of $52,000 and it will distribute $5,200 to Matt and $2,800 to Jerry. Jerry is in the 32% marginal tax bracket and Matt is in the 24% marginal tax bracket. Their marginal tax brackets will not change as a result of profit or loss from this business. How much tax will Matt pay in the second year (rounded to the nearest dollar) due to this business if they organize the business as an S corporation?

• A) $10,920
• B) $9,464
• C) $4,056
• D) $3,276
• E) $1,456

Explore the factors leading to overexploitation of natural resources, focusing on fisheries and forests.

Identify the economic benefits of forests beyond timber, including ecological services.

Understand the demographic challenges facing industrialized nations and their impact on social systems.

Understand the principles of Individual Transferable Quotas (ITQs) and their impact on the profitability of fishing operations.

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Definitions:

Passion-based Intimacy

An emotional closeness that stems from shared enthusiasm or deep interest in particular activities or topics.

Friendship-based Intimacy

The closeness and bond that develop from deep friendship, characterized by trust, affection, and mutual respect.

Relationship-specific Social Decentering

The ability to step outside one's own perspective within the context of a specific relationship to understand the thoughts, feelings, or motivations of another person.

Overlapping Stages

Phases in a process where certain aspects or actions occur simultaneously or intersect with one another.