In 2020 Gus owns 85% of Sweet & Associates. Sweet & Associates is a law...
60.1K
Verified Solution
Link Copied!
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!
