Pane additional stock to obtain 80% control. 6. Choice of Capital Structure. Kobe transfers $500,000 in cash to newly formed Bryant Corporation for 100% of Bryant's stock. In the first year of operations, Bryant's taxable income before any payments to Kobe is $120,000. What total amount of taxable income must Kobe and Bryant each report in the following two scenarios? a. Bryant pays a $70,000 dividend to Kobe. b. Assume that when Bryant was formed, Kobe transferred his $500,000 to the corpora-tion for $250,000 of Bryant stock and $250,000 in Bryant notes. The notes are repay-able in five annual installments of $50,000 plus 8% annual interest on the unpaid balance. During the current year, Bryant gives Kobe $50,000 in repayment of the first note plus $20,000 interest. 1