Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. kansas corporation is a 68% shareholder in colorad

Kansas Corporation is a 68% shareholder in Colorado, Inc. Last year, Colorado paid Kansas $100,000...

90.2K

Verified Solution

Question

Accounting

Kansas Corporation is a 68% shareholder in Colorado, Inc. Last year, Colorado paid Kansas $100,000 as compensation for unspecified services provided by Kansas employees to Colorado, and deducted the payment on its federal income tax return. The revenue agent who audited both corporations' returns concluded that the payment is a constructive dividend. Both corporations have a 21% marginal tax rate. What is the effect of this audit conclusion on each corporation's income tax liability?

a. Kansas $13,650 decrease; Colorado $21,000 increase

b. Kansas $21,000 decrease; Colorado $21,000 increase

c. Kansas $21,000 increase; Colorado -0- effect

d. Kansas -0- effect; Colorado $21,000 decrease

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

Basic Math
1.2K views

Find the value of the standard normal random variable zz , called z0z0 such that: (a) P(z?z0)=0.9999P(z?z0)=0.9999 z0=z0= (b) P(?z0?z?z0)=0.922P(?z0?z?z0)=0.922 z0=z0= (c) P(?z0?z?z0)=0.3954P(?z0?z?z0)=0.3954 z0=z0= (d) P(z?z0)=0.4497P(z?z0)=0.4497 z0=z0= (e) P(?z0?z?0)=0.3225P(?z0?z?0)=0.3225 z0=z0= (f) P(?1.66?z?z0)=0.5474P(?1.66?z?z0)=0.5474 z0=z0=

Psychology
1.2K views

Phillosophy!! What are the various reasons Descartes provides to show how he can doubt various categories of...

Physics
1.2K views

Water falls without splashing at a rate of 0.400 L/s from a height of 3.60 m...

Physics
1.2K views

20 A cavity of radius R 2 is made inside a solid sphere of radius...

Physics
1.2K views

A circuit is made up of resistance 3 0 and inductance 0 01 H An...

Algebra
1.2K views

Let g x 2 The following graph shows g x for a between Y a...

Algebra
1.2K views

Determine two different Hamilton paths in the following graph Select all that apply A A...

Accounting
1.2K views

Martha and Jess Samuelsson are sisters with extensive experience in practicing law....

Accounting
1.2K views

Erie Company manufactures a mobile fitness device called the Jogging Mate. The company uses standards...

Accounting
1.2K views

, Janzen, Inc., sells all of its production acco unt Janzen has the following accounts...

Accounting
1.2K views

2. XYZ Company borrowed $80,000 on November 1,2025 , by signing a $80,000,12%,3-month note. Prepare...

Finance
1.2K views

You purchase a bond with an invoice price of $1,130. The bond has a coupon...