Part. D only

1. (25 %) You are the CEO of Advanced Excavators, Incorporated. Your salary from your job is $120,000, net of all exemptions and deductions, and your personal tax rate is 30%. The company profits (earnings) before tax are $150,000. Assume a flat corporate tax rate at 28%. a. 6% What is the amount of tax you will have to pay personally if you do not take any of the profits of the firm? How much tax will the corporation pay?- What would be the corporate earnings after tax?- b. 6% You decide to give yourself a dividend of $60,000 from the company profits. How much personal income tax will you pay in total? How much is left in corporate retained earnings after the dividend payout? c. 5% You had considered this year purchasing a 3-year class equipment for $60,000 to be depreciated on a straight-line basis, with 1/3 of the value depreciable this year, and in each of the next 2 years. What would have been this year the corporate taxable income, and after tax cash flow, had your purchased that equipment, assuming no other impact on revenues or costs from the equipment purchase? Corporate Taxable Income: After-Tax Cash Flow: d. 8% Assume that Advanced Excavators is a sole proprietorship, with total profits before tax of $270,000. What would be your income tax, without and with the equipment purchase in question 3 and assuming no dividends paid out? - w/o equipment With equipment 1. (25 %) You are the CEO of Advanced Excavators, Incorporated. Your salary from your job is $120,000, net of all exemptions and deductions, and your personal tax rate is 30%. The company profits (earnings) before tax are $150,000. Assume a flat corporate tax rate at 28%. a. 6% What is the amount of tax you will have to pay personally if you do not take any of the profits of the firm? How much tax will the corporation pay?- What would be the corporate earnings after tax?- b. 6% You decide to give yourself a dividend of $60,000 from the company profits. How much personal income tax will you pay in total? How much is left in corporate retained earnings after the dividend payout? c. 5% You had considered this year purchasing a 3-year class equipment for $60,000 to be depreciated on a straight-line basis, with 1/3 of the value depreciable this year, and in each of the next 2 years. What would have been this year the corporate taxable income, and after tax cash flow, had your purchased that equipment, assuming no other impact on revenues or costs from the equipment purchase? Corporate Taxable Income: After-Tax Cash Flow: d. 8% Assume that Advanced Excavators is a sole proprietorship, with total profits before tax of $270,000. What would be your income tax, without and with the equipment purchase in question 3 and assuming no dividends paid out? - w/o equipment With equipment