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Problem 2 .You are a poraion. The corporation's earnings before taxes is $8 per share. The company will retain 25% of earnings after taxes, paying
Problem 2 .You are a poraion. The corporation's earnings before taxes is $8 per share. The company will retain 25% of earnings after taxes, paying out the remainder to stockholders. The corporate tax rate is 40%, your tax rate on dividend income is 15%, and your tax rate on non-dividend income is 25%. How much of the firm's per share earnings before taxes remain after all taxes are paid? How much total is paid in taxes? What total tax rate is paid
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