Check my work mode: This shows what is correct or incorrect for the work you have completed so far. It does not indicate completion. 1 10 points During a recent IRS audit, the revenue agent decided that the Parker family used their closely held corporation, Falco, to avoid shareholder tax by accumulating earnings beyond the reasonable needs of the business. Falco's taxable income was $970,000, it paid no dividends, and it had no business need to retain income. Falco's marginal tax rate in prior years was 34 percent. Assume the accumulated earnings tax rate is 20% for all applicable years in this problem. Required a. Compute Falco's accumulated earnings tax assuming that it had accumulated $6 million after-tax income in prior years. Assume that for these years at issue, a corporation is exempt up to $250,000 of accumulated earnings without demonstrating a reasonable business need for the accumulation. b. Compute Falco's accumulated earnings tax assuming that it had accumulated $137,000 after-tax income in prior years. Assume that for these years at issue, a corporation is exempt up to $250,000 of accumulated earnings without demonstrating a reasonable business need for the accumulation. MC Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required A Required B Compute Falco's accumulated earnings tax assuming that it had accumulated $6 million after-tax income in prior years. (Enter your answer in dollars and not in millions of dollars) Accumuted earningstex $ $12,1601 Required>> < Prev 10 of 10 Next > Return to