On January 1, 2018, Dexter Corporation was organized by Adams and Bob, equal calendar-year shareholders, and began doing business on January 1, 2018. Dexter elected to file its income tax return on a calendar-basis. In December 2017, Adams and Bob come to you to ask whether an S corporation form would be advisable. For items 1 through 9, select the correct response from the following list. A: Higher overall income tax to an S corporation and shareholders than to a C corporation and shareholders B: Lower overall income tax to an S corporation and shareholders than to a C corporation and shareholders C: Same overall income tax either as an S corporation or a C corporation D: Cannot elect as an S corporation 1. Dexter Corporation expects to have an operating loss in 2018. .B 2. Dexter Corporation expects to have a business income of $100,000 and a LTCG. Ignore the fact that Dexter B Corporation was organized on January 1, 2018. 3. Dexter Corporation expects to have a capital loss. 4. Dexter Corporation distributes all carnings to shareholders. 3 5. Dexter Corporation expects to have an operating income of $100,000 and both Adams and Bob are in 37% tax bracket. 6. Dexter Corporation pays life insurance premiums on behalf of Adams and Bob. 7. Dexter Corporation owns 100% of Riley Corporation, a C corporation, and expects to receive $10,000 dividend. A 3. Adams is Japanese. Neyter Corneration will issue both common stock and preferred stock to shareholders