Bread Corporation Is a C Corporation with Earnings of $100,000

question 42

Multiple Choice

Bread Corporation is a C corporation with earnings of $100,000. It paid $20,000 in dividends to its sole shareholder, Gerald. Gerald also owns 100% of Butter Corporation, an S corporation. Butter had net taxable income of $80,000 and made a $15,000 distribution to Gerald. What income will Gerald report from Bread and Butter's activities?

• A)$35,000
• B)$95,000
• C)$100,000
• D)$180,000