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15. An S corporation earns $ 9.00 per share before taxes. The corporate tax rate is​...

15.

An S corporation earns $ 9.00 per share before taxes. The corporate tax rate is​ 39%, the personal tax rate on dividends is​ 15%, and the personal tax rate on​ non-dividend income is​ 36%. What is the total amount of taxes paid if the company pays a $ 6.00 ​dividend?

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Answer #1

The Answer is $3.24

Since it is an S Corporation.Tax paid = earnings per share * non dividend income rate.

So earning per share = $9

Non dividend income rate = 36%

Total Amount of tax paid = $9*36% = $3.24

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