Inc., which manufactures greeting cards. Totos average annual net profit (before deduction of Mr. Lions salary) is $320,000. For each of the following cases, compute the income tax burden on this profit. Assume that all dividends are taxed to individuals at a 20% tax rate. (Ignore any payroll tax consequences.)

Required:

a. Toto is a C Corporation subject to a 21% tax rate. Mr. Lions salary is $100,000, and Toto pays no dividends.

b. Toto is a C Corporation subject to a 21% tax rate. Mr. Lions salary is $100,000, and Toto distributes its after-tax income as a dividend.

c. Toto is an S corporation. Mr. Lions salary is $100,000, and Toto makes no cash distributions. Assume Toto's ordinary income qualifies for the 20 percent QBI deduction, subject to no limitations.

d. Toto is an S corporation. Mr. Lion draws no salary, and Toto makes no cash distributions. Assume Toto's ordinary income qualifies for the 20 percent QBI deduction, subject to no limitations.

e. Toto is an S corporation. Mr. Lion draws no salary, and Toto makes cash distributions of all its income to Mr. Lion. Assume Toto's ordinary income qualifies for the 20 percent QBI deduction, subject to no limitations.