A. You have just incorporated and started your business. Your pre-tax prot is $30,000. You want to preserve as much cash in the company as possible but you need income to live on; this is your only source of income. Would you prefer to receive your compensation as $30,000 of salary or a dividend of the after-tax profit? B. Your company is now very successful. The corporate income is $500,000 before any compensation to you. You want to take out $100,000 of either salary or dividend. Which would you prefer? C. Now your company is making $600,000 after your salary of $150,000. (1) Should you declare a bonus of $100,000 to reduce income to the business limit? (2) Should you pay a dividend equal to the amount needed to bring the corporate cash to corporate cash available under the $100,000 bonus option in (3(1) above? The first thing you should do is consider what comparison you are going to make to decide between compensation options. This will help you organize your calculations. Please ignore the CPP payroll costs in your analysis. The provincial corporate tax rate on active business income is 4% if it is eligible for the small busine deduction and 12% if it is not