of $900.000 at the beginning of the year. A distribution The entity holds earnings and profits (AAA for an S corporation) of $900,000 at the beginning of the of $200,000 is made to the owners. a. Determine the income for each entity type below: (1) If the entity is a C corporation then the taxable income is $ . (2) If the entity is an S-corporation then the ordinary income of the corporation is $ b. Determine the effect of the distribution on the shareholders for the entity. (1) C corporation: Shareholders have $200,000 (2) S corporation: Shareholders have $200,000 32. PR. 16-29.Algo (Algorithmic) Problem 16-29 (Algorithmic) (LO. 1) Perk Corporation is subject to tax only in State A. Perk generated the following income and deductions: Federal taxable income $378,500 State A income tax expense 18,925 Refund of State A income tax 3,785 Depreciation allowed for Federal tax purposes 246,025 Depreciation allowed for state tax purposes 151,400 Federal taxable income is the starting point in computing State A's taxable income. State income taxes are not deductible for State A's tax purposes. Perk's State A taxable income is $ 33. DQ.20-02 Discussion Question 20-2 (LO. 1) In general terms, indicate how the following separate entities are subject to the Federal income tax. a. C corporations separate taxable entities, their shareholders. b. How are partnerships and limited liability corporations taxed? c. S corporations incur Federal income tax liabilities. d. Fiduciary entities are subject to Federal income tax when income