Question
McClean owns 100 percent of the shares in McDan Incorporated, a C corporation. Assume the following for the current year: McDan Incorporated's pretax income =
McClean owns 100 percent of the shares in McDan Incorporated, a C corporation. Assume the following for the current year:
| McDan Incorporated's pretax income = $16,000 |
| Percentage of after-tax earnings retained by McDan Incorporated = 0% (i.e., all after-tax earnings distributed) |
| McClean's dividend tax rate = 15% |
Given these assumptions, how much cash does McClean have from the dividend after paying taxes on the distribution
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Auditing Theory And Practice
Authors: C. William Thomas, Bart Ward, Emerson Henke
3rd Edition
0534920748, 978-0534920746
