1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
leva [86]
3 years ago
12

Jonathan (an individual) owns 100% of the stock of Husky, Inc. (a C corporation) and 100% of the stock of Calhoun, Inc. (another

C Corporation). Calhoun, Inc. is very successful and has millions in earnings and profits. Husky has not fared so well and has no earnings and profits. In the current year, Husky ran out of cash and could not make its payroll. Because of this situation, Jonathan directed Calhoun, Inc. to pay $100,000 in wages to employees of Husky. The $100,000 payment was not structured as a loan.
A. How should Calhoun, Inc. treat the $100,000 payment for tax purposes?
B. How should Jonathan treat the $100,000 payment for tax purposes?
Business
1 answer:
BaLLatris [955]3 years ago
8 0

Answer: A. As Expenses

B. No treatment.

Explanation:

A. The $100,000 was not structured and a loan so it will be accounted for as EXPENSES. This means that it will be deducted from the Income for the year from Calhoun's books.

B. A C Corporation is by definition taxed SEPARATELY from it's owners in the United States of America. Seeing as both Corporations were C Corporations, Jonathan as the owner of both companies need not worry about how he should treat the $100,000 payment as he will not ne taxed on it.

You might be interested in
Concord Corporation owned 16000 shares of Ivanhoe Corporation. These shares were purchased in 2017 for $130000. On November 15,
mafiozo [28]

Answer:

  • Gain = $271,310
  • Net reduction in retained earnings = $‭105,690‬

Explanation:

Gain = (Ivanhoe market price - Purchase price) * Number of shares issued as property dividend

Purchase price = 130,000 / 16,000

= $8.13

Number of shares issued as property dividend = 130,000 shares of Concord / 10

= 13,000 Ivanhoe shares

Gain = (29 - 8.13) * 13,000

= $‭271,310‬

Net reduction in retained earnings:

= Dividends payable - Gain

= (13,000 * 29) - ‭271,310‬

= $‭105,690‬

4 0
3 years ago
Historically, a factory has been able to produce a very specialized nano-technology component with 35% reliability, i.e., 35% of
pochemuha

Answer:

Yes

Explanation:

From the given output

The  Probability of getting 13 or more passed

when the  reliability = 0.35. can be calculated as follows

=0.0258+0.0109+0.0039+.0012+0.0004 = 0.0422   ≈  4.2%

Since the probability is less than the  5% level we will therefore reject the Null hypothesis  

answer : YES

5 0
3 years ago
Roberta’s brokerage account contains 10 stocks. She has held five of those stocks for over two years, and she purchased the othe
Elena L [17]

Answer: b

Explanation: took the test

3 0
3 years ago
For most people, the purchase of a Ford automobile would employ which type of consumer decision making?
Nostrana [21]

Answer:

Extended decision making

Explanation:

Extended decision making is the decision making which involve the very high level of the purchase, an internal as well as extensive information search which is followed by the complex computation of the alternatives available and thorough evaluation is taken place when the purchase will take place.

So, for most of the people, when the decision of purchase is to be made like for the Ford automobile, the people will choose the extended decision making as it is expensive, infrequently purchased products.

5 0
3 years ago
Which financial institution is known as a cooperative association?
Serhud [2]

Answer:

<em>Credit Unions</em><em> </em>is known as a cooperative association.

hope it helps!

5 0
3 years ago
Other questions:
  • The following information is available for Crane Company: Sales $480000 Total fixed expenses $150000 Cost of goods sold 290000 T
    15·1 answer
  • You have just won the lottery and will receive $460,000 in one year. You will receive payments for 27 years, and the payments wi
    5·1 answer
  • What is the total amount of adjustments on evies tax return
    13·1 answer
  • In the current year, Norris, an individual, has $52,000 of ordinary income, a net short-term Capital loss (NSTCL) of $9,800 and
    5·1 answer
  • The operations, management, and regulation of a financial conglomerate are the same irrespective of the types of services offere
    10·1 answer
  • The main purpose of a cover letter is to: a. Get hired b.be called in for an interview c. Let your friends know how your job sea
    14·2 answers
  • What is codetermination?
    13·1 answer
  • The owner and a property manager sign a property management agreement. The property manager advertises the property, shows the r
    6·1 answer
  • Your company has two​ divisions: One division sells software and the other division sells computers through a direct sales​ chan
    6·1 answer
  • What does "pivoting" mean in the process of concept development?
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!