Consider a s corporation the corporation earns 35 per share


Consider a S corporation. The corporation earns $3.5 per share before taxes. The corporate tax rate is 35%, the tax rate on dividend income is 15%, and the personal income tax rate is set at 39.6%.

1. What are the shareholder's earnings from the corporation after all corresponding taxes are paid?

2. How much is the total effective tax rate on the corporation earnings?

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Financial Management: Consider a s corporation the corporation earns 35 per share
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