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Problem 17-30 (LO. 1) In the current year, Azure Company has $350,000 of net operating income before deducting any compensation or other payment to its
Problem 17-30 (LO. 1) In the current year, Azure Company has $350,000 of net operating income before deducting any compensation or other payment to its sole owner, Sasha. In addition, Azure has interest on municipal bonds of $25,000. Sasha has significant income from other sources and is in the 37% marginal tax bracket. Based on this information, determine the income tax consequences to Azure Company and to Sasha during the year for each of the following independent situations. (Ignore the deduction for qualified business income and the 3.8% Medicare surtax on net investment income.) The rates on qualified dividends are 0%, 15% and 20%. If an amount is zero, enter "O". a. Azure is a C corporation and pays no dividends or salary to Sasha. Azure Company, as a C corporation, has taxable income of $ and corporate income tax of $ Sasha has taxable income of $ from Azure. b. Azure is a C corporation and distributes $75,000 of dividends to Sasha. and corporate income tax of $ Sasha incurs income Azure Company has taxable income of $ tax of $ with respect to the dividends
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