Question
Robert is the sole shareholder and CEO of ABC, Inc., an S corporation that is a qualified trade or business. During the current year, ABC
Robert is the sole shareholder and CEO of ABC, Inc., an S corporation that is a qualified trade or business. During the current year, ABC has net income of $305,000 after deducting Robert's $91,500 salary. In addition to his compensation, ABC pays Robert dividends of $213,500.
a. What is Robert's qualified business income? $305,000? (correct)
b. What is Robert's qualified business income if you determined that reasonable compensation for someone with Robert's experience and responsibilities is 181,500?
$213500(incorrect), $91500(incorrect).
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Financial Accounting For MBAs
Authors: Peter D. Easton, John J. Wild, Robert F. Halsey, Mary Lea McAnally
3rd Edition
0978727932, 978-0978727932
