2 check my works used b gerald must include in income

2 Check My Works used
b. Gerald must include in income the entire $15,000 dividend he received from Marmot, and he w
individuals.
Solution
Discussion Question 3-15 (LO. 1, 2)
Marmot Corporation pays a dividend of $100,000 in the current year. Otter Corporation, owns 15% o
taxpayer in the 24% marginal bracket, also owns 15% of Marmot's stock.
Compare and contrast the treatment of the dividend by Otter Corporation and Gerald.
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a. Otter Corporation will be allowed a dividends received deduction equal to 50 %
tax of 21 % on the remaining portion of the dividends.
b. Gerald must include in income all of the dividends . He will pay tax at the 15 % r
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9/17/2018 ...

Discussion Question 3-16 (LO. 2)
Mustard Corporation (a C corporation) owns 15% of the stock of Burgundy Corporation (a C
corporation), which pays an annual dividend to its shareholders. Mustard is considering the purchase of
additional shares of Burgundy stock.
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Would this stock purchase affect the amount of dividends received deduction that Mustard can claim?
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