Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. in 2020 gus owns 85% of sweet & associates. sw

In 2020 Gus owns 85% of Sweet & Associates. Sweet & Associates is a law...

60.1K

Verified Solution

Question

Accounting

In 2020 Gus owns 85% of Sweet & Associates. Sweet & Associates is a law firm and distributes to Gus $300,000. The firm has sales income of 4,200,000 and operating expenses of $1,400,000. The firm has property with an unadjusted basis of $500,000 and paid W2 wages for the year of $300,000. Gus is married and his taxable income (excluding any income from Sweet & Associates) is $550,000. For each independent scenario below how the entity will be taxed and how Gus return will be affected by the income from Sweet & Associates. (8 points)

a) Sweet & Associates is a C-Corporation

b) Sweet & Associates is an S- Corp

c) Sweet & Associates is a Sole Proprietorship and Gus owns 100%

d) How would your answer change (or not) in part b if they were a manufacturing company instead of a law firm?

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students