Zenon Corporation generates taxable income of $100,000 per year.Yellow Corporation generates taxable income of $50,000 per year.
a.Calculate regular income tax liability for Zenon and Yellow.
b.How would your answers to part (a)change if Mary Jones is the sole shareholder of both Zenon and Yellow?
c.How would the ownership of the two corporations impact their tax liability if Zenon and Yellow each generated taxable income of $500,000? Provide calculations to support your conclusion.

Question

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The Answer of Zenon Corporation generates taxable income of $100,000 per year.Yellow Corporation generates taxable income of $50,000 per year.
a.Calculate regular income tax liability for Zenon and Yellow.
b.How would your answers to part (a)change if Mary Jones is the sole shareholder of both Zenon and Yellow?
c.How would the ownership of the two corporations impact their tax liability if Zenon and Yellow each generated taxable income of $500,000? Provide calculations to support your conclusion.

Zenon Corporation Generates Taxable Income of $100,000 Per Year