Kristen, the president and sole shareholder of Egret Corporation, has earned a salary bonus of $$160,500$ for the current year. Because of the lower tax rates on qualifying dividends, Kristen is considering substituting a dividend for the bonus.

Assume that the tax rates are $24\%$ for Kristen and $21\%$ for Egret Corporation. Round your answers to nearest dollar, if required.

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a$.$ How much better off would Kristen be if she were paid a dividend rather than salary?

If Kristen were paid a bonus, she would receive $fill in the blank $9786$d$9051$ff$1$fa$6\_1$ after taxes. If Kristen receives a dividend rather than salary, she would receive $fill in the blank $9786$d$9051$ff$1$fa$6\_2$ after taxes. Thus, she would be better off by receiving the

$.$

How much better off would Egret Corporation be if it paid Kristen a salary rather than a dividend?

The net after$-$tax cost of the bonus for Egret Corporation would be $fill in the blank $434023067$f$93$f$9$f$\_1$ and the net after$-$tax cost for the dividend would be $fill in the blank $434023067$f$93$f$9$f$\_2.$ Therefore, Egret would be better off by $fill in the blank $434023067$f$93$f$9$f$\_3$ if it paid the

$.$

Assume Egret Corporation paid Kristen a salary bonus of $$208,650$ instead of a $$160,500$ dividend.

If Egret Corporation were to pay Kristen a salary bonus of $$208,650$ instead of a $$160,500$ dividend, Kristen would receive $fill in the blank $4$fa$111010$fa$705$c$\_1$after taxes. The bonus would cost Egret Corporation $fill in the blank $4$fa$111010$fa$705$c$\_2$ after taxes.

What should Kristen do$?$

Both Egret Corporation and Kristen are better off with the

$.$