Question: please help me get the right answer. thank you - Albert owns 100% of A Corporation, Betty is the sole proprietor of B Compary, and

please help me get the right answer. thank you  please help me get the right answer. thank you - Albert
owns 100\% of A Corporation, Betty is the sole proprietor of B

- Albert owns 100\% of A Corporation, Betty is the sole proprietor of B Compary, and Cai is the sole proprietor of C Company. - Each business gencroted $500,000 of taxable incorme and before-tax cash flow. - A Corporation and B Company produce a product, but C Company provides accounting services - A Corporation will distribute $200,000 of its after-tax income to Albert. - All three owners face a 37% margiral tax rate on ordinary income. - b Company qualifies for the 9199 A deduction, but C Company does not because it provides accounting services and its taxable income exceeds the threshold for that deduction Aswume the tax rate applied to dividend income equals the top 20% net long-term capital gain rate plus the 3.8% net investment income: tax rate. The corporate tax rate is 21% and 5199A deduction is 20%. What will be the values of A Corporation, B Compary, and C Company after three years? Assume that each business (a) required a \$5,000,000 initial imyestment, (b) eorns an annual 10% before tax rate of return on the bepinning of the-year investment, (c) can reinveet ifs aftet tak cast, thow back into the business, and (d) there is no unrealized appreciation of their assets. 21hu codgenase tax rate and 41 trak deducenin for qualifel flow through tentities - Albert owns 100\% of A Corporation, Betty is the sole proprietor of B Compary, and Cai is the sole proprietor of C Company. - Each business gencroted $500,000 of taxable incorme and before-tax cash flow. - A Corporation and B Company produce a product, but C Company provides accounting services - A Corporation will distribute $200,000 of its after-tax income to Albert. - All three owners face a 37% margiral tax rate on ordinary income. - b Company qualifies for the 9199 A deduction, but C Company does not because it provides accounting services and its taxable income exceeds the threshold for that deduction Aswume the tax rate applied to dividend income equals the top 20% net long-term capital gain rate plus the 3.8% net investment income: tax rate. The corporate tax rate is 21% and 5199A deduction is 20%. What will be the values of A Corporation, B Compary, and C Company after three years? Assume that each business (a) required a \$5,000,000 initial imyestment, (b) eorns an annual 10% before tax rate of return on the bepinning of the-year investment, (c) can reinveet ifs aftet tak cast, thow back into the business, and (d) there is no unrealized appreciation of their assets. 21hu codgenase tax rate and 41 trak deducenin for qualifel flow through tentities

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!