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Sandra would like to organize LAB (a legal corporation) as either an S corporation or a C corporation for tax purposes. In either form, the entity is expected to generate an 8 percent annual before-tax return on a $1,000,000 investment. Sandra's marginal income tax rate is 37 percent and her tax rate on qualified dividends and net capital gains is 20 percent. LAB's income is not qualified business income (QBI), so Sandra is not allowed to claim the QBI deduction. Assume that LAB will distribute all of its earnings after entity-level taxes every year. Ignore the additional Medicare tax and the net investment income tax when computing your answers. Note: Round your intermediate computations to the nearest whole dollar amount. Problem 15-51 Part a (Algo) a. How much cash after taxes would Sandra recelve from her investment in the first year if LAB is organized as elther on corporation or a C corporation? Sandra would like to organize LAB (a legal corporation) as elther an S corporation or a C corporation for tax purposes. In either form, the entity is expected to generate an 8 percent annual before-tax return on a $1,000,000 investment. Sandra's marginal income tax rate is 37 percent and her tax rate on qualified dividends and net capital gains is 20 percent. LAB's income is not qualified business income (QBI), so Sandra is not allowed to claim the QBI deduction. Assume that LAB will distribute all of its earnings after entity-level taxes every year. Ignore the additional Medicare tax and the net investment income tax when computing your answers. Note: Round your intermediate computations to the nearest whole dollar amount. Problem 15-51 Part b (Algo) b. What is the overall tax rate on LAB's income in the first year if LAB is organized as an S corporation or as a C corporation Note: Round your final answers to 2 decimal places. After several years of profitable operations, Javell, the sole shareholder of JBD Incorporated, a C corporation, sold 22 percent of her JBD stock to ZNO Incorporated, a C corporation in a similar industry. During the current year. JBD reports $1,900,000 of after-tax income JBD distributes all of its after-tax eamings to its two shareholders in proportion to their shareholdings. How much tax will ZNO pay on the dividend it receives from JBD? What is ZNO's tax rate on the dividend income (after considering the DRD)? [Hint See 5243] Note: Round the "Tax rate on dividend income" to 2 decimal places