Crocker and Company (CC)is a C Corporation

question 70

Multiple Choice

Crocker and Company (CC) is a C corporation. For the year, CC reported taxable income of $550,000. At the end of the year, CC distributed all its after-tax earnings to Jimmy, the company's sole shareholder. Jimmy's marginal ordinary tax rate is 37 percent and his marginal tax rate on dividends is 23.8 percent, including the net investment income tax. What is the overall tax rate on Crocker and Company's pretax income?

• A)18.8%
• B)23.8%
• C)21%
• D)39.8%
• E)44.8%

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Definitions:

Light Intensity

The amount of light energy per unit of area, an important factor in the photosynthesis process and plant growth.

Cones

Geometric shapes that have a circular base and a single vertex.

Night Vision

The ability to see in low-light conditions.

Fine Detail

The intricate and precise features or aspects of something, often requiring close inspection or careful attention to be appreciated or understood.