Marathon Inc. (a C corporation) reported $1,550,000 of taxable income in the current year. During the year it distributed $155,000 as dividends to its shareholders as follows: (new corporate income tax rate has been mentioned as " 21% on all taxable income" as per the recent change. )

$7,750 to Guy, a 5% individual shareholder.

$23,250 to Little Rock Corp., a 15 percent shareholder (C corporation)

$124,000 to other shareholders.

a.How much of the dividend payment did Marathon deduct in determining its taxable income?

b.Assuming Guy's marginal ordinary tax rate is 37%, how much tax will he pay on the $7,750 dividend he received from Marathon Inc. (including the net investment income tax)?

c.What amount of tax will Little Rock Corp. pay on the $23,250 dividend it received from Marathon Inc. (50 percent dividends received deduction)?