Company G, which has a 35 percent marginal tax rate, owns a controlling interest in Company J, which has a 15 percent marginal tax rate. Both companies perform engineering services. Company G is negotiating a contract to provide services for a client. Upon satisfactory completion of the services, the client will pay $89,000 cash.

Required:

1. Compute the after-tax cash from the contract assuming that Company G is the party to the contract and provides the services to the client.
2. Compute the after-tax cash from the contract assuming that Company J is the party to the contract and provides the services to the client.
3. Compute the after-tax cash flow for Company G from the contract assuming that Company J is the party to the contract, but Company G actually provides the services to the client.