Bryan Houlberg Expects His C Corporation to Generate a Profit

question 12

Multiple Choice

Bryan Houlberg expects his C corporation to generate a profit of $200,000.What is the effective tax rate on the $200,000 if net income after corporate tax is distributed to him as a dividend and his marginal tax rate on ordinary income is 39.6%?

• A)35%
• B)59.6%
• C)44.5%
• D)39.6%

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Definitions:

Express Disclaimer

A clear and unequivocal statement ensuring that certain facts or rights are not implied from a document or statement.

Oral Warranties

Guarantees made verbally about the quality or function of a product, not in written form.

Comparative Negligence

A legal doctrine that reduces the plaintiff's damages award by the percentage of their fault in causing the injury.

Strict Liability

Strict Liability is a legal principle that holds an individual or entity responsible for damages or harm caused by their actions, irrespective of negligence or intent.