acct 387 ch 3 q 2

Tawana owns and operates a sole proprietorship and has a 37 percent marginal tax rate. She provides her son, Jonathon, $18,000 a year for college expenses. Jonathon works as a pizza delivery person every fall and has a marginal tax rate of 15 percent. Required: a. What could Tawana do to rec ce her family tax burden? b. How much pretax income does it currently take Tawana to generate the $18,000 (after taxes) given to Jonathon? c. If Jonathon worked for his mother's sole proprietorship, what solary would she have to pay him to generate $18,000 after taxes (ignoring any Social Security, Medicare, or self-employment tax issues)? d. How much money would the strategy in part (c) save