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Elden [556K]
3 years ago
6

A C corporation earns $ 8.80 per share before taxes. The corporate tax rate is​ 39%, the personal tax rate on dividends is​ 15%,

and the personal tax rate on​ non-dividend income is​ 36%. What is the total amount of taxes paid if the company pays a $ 6 ​dividend?
Business
1 answer:
alexandr1967 [171]3 years ago
8 0

Answer:

The dividends taxes are $0.90

Explanation:

<u>For the dividend, it will apply the dividend tax rate.</u>

The other tax rates are irrelevant.

dividends \times (1-tax \:rate) = after-tax \: dividends

6\times (1-.15) = 6 \times 0.85 = 5.10

dividends \times tax \:rate = dividends \: tax

6\times 0.15 = 0.90

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