Kuljeet owns 20% of the stock of the Flin Flon Corporation.The tax rate on dividend income is 15%.If Flin Flon makes a dividend payment of $2,000,000 paid proportionally to its shareholders,how much of this amount would Kuljeet receive after taxes?

Question

Quizplus · Accepted Answer

Kuljeet owns 20% of the stock, so he would receive 20% of the $2,000,000 dividend payment, which is $400,000 before taxes. After the 15% tax on dividend income, Kuljeet would receive $400,000 * (1-0.15) = $340,000. Therefore, the correct answer is D.

Kuljeet Owns 20% of the Stock of the Flin Flon