Business, 20.12.2019 02:31 rachel2005smith

Nancy smith is the sole shareholder and employee of white corporation, a calendar year c corporation that is engaged exclusively in accounting services. during the current year, white has operating income of $320,000 and operating expenses (excluding salary) of $150,000. further, white corporation pays nancy a salary of $100,000. the salary is reasonable in amount and nancy is in the 32% marginal tax bracket irrespective of any income from white. assuming that white corporation distributes all after-tax income as dividends, how much total combined income tax do white and nancy pay in the current year? (ignore any employment tax considerations.) a. $40,295 b. $63,325 c. $64,396 d. $54,995 e. none of these choices are correct.

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Nancy smith is the sole shareholder and employee of white corporation, a calendar year c corporation...

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