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Rufina [12.5K]
3 years ago
14

Tomas owns a sole proprietorship, and Lucy is the sole shareholder of a C corporation. In the current year, both businesses make

a net profit of $60,000. Neither business distributes any funds to the owners in the year. For the current year, Tomas must report $60,000 of income on his individual tax return, but Lucy is not required to report any income from the corporation on her individual tax return.a. True
b. False
Business
1 answer:
MA_775_DIABLO [31]3 years ago
7 0

Answer:

True

Explanation:

While a sole proprietor is expected to report his business income or loss on his personal tax form as the business is not considered  for separate tax , a c corporation shareholders are taxed based on the dividends received from the business profit and the entire profit taxed for the corporation tax.

As no profit was distributed to the owners , there was no personal tax basis for Lucy but only the corporation tax that will be charged on the business net profit.This could have been a tax avoidance method adopted by Lucy to reduce his tax liabilities as a sole share holder.

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 Because of its importance in summarizing your strategy, the Introduction and Overview of your business plan should be 
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3 years ago
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3 years ago
A customer has purchased 1,000 shares of ABC stock at $44 per share, paying a commission of $1.00 per share for the transaction.
Sonbull [250]

Answer:

Option D) 1,200 shares held at a cost basis of $37.50 per share

Explanation:

Data provided in the question:

Number of shares of ABC stocks purchased by the customer = 1,000

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Commission paid = $1.00 per share

Stock dividend declared = 20%

Now,

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also,

each share is theoretically worth less after the stock dividend is paid.

Therefore,

The number of shares customer will have = Shares purchased × (1 + Dividend declared)

= 1000 × ( 1 + 0.20)

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Option D) 1,200 shares held at a cost basis of $37.50 per share

3 0
3 years ago
Read each of the four activities and put them in their proper sequence. Be advised that the action listed is not the only action
Phantasy [73]

Answer:

Step     Activities

1           Determine how expensive a car you can afford.

2.         Identify the car that meets your needs and wants in terms of size, styling, performance, and safety and obtain online quotes for three target cars.

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4.        Change the oil, rotate the tires, and replace the windshield wipers as needed.

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3 years ago
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