Question
ABC Corporation Limited has A, B and C three owners, with 50%, 30% and 20% ownership respectively. In a particular financial year, the total revenue
ABC Corporation Limited has A, B and C three owners, with 50%, 30% and 20% ownership respectively. In a particular financial year, the total revenue of the corporation is $1,250,000, and the total cost is $500,000. In this financial year, 60% of the after tax net income is paid as dividends. Assuming (1) the company income tax rate is 25% and the personal income tax rate is 18%, (2) A, B and C do not have any other income from any other source, and (3) A, B and C each has a total amount of deductions and exemptions of $50,000, what is the income tax paid by the company and what is the personal income tax paid by A, B and C respectively?
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