Riverbend Inc. received a $367,500 dividend from stock it held in Hobble Corporation. Riverbend's taxable income...

Riverbend Inc. received a $367,500 dividend from stock it held in Hobble Corporation. Riverbend's taxable income is $2,450,000 before deducting the dividends received deduction (DRD), a $60,500 NOL carryover, and a $138,000 charitable contribution. Use Exhibit 16-6. (Round your tax rates to 1 decimal place. Leave no answer blank. Enter zero if applicable.)

a. What is Riverbend’s deductible DRD assuming it owns 10 percent of Hobble Corporation?

DRD

b. Assuming the facts in part (a), what is Riverbend’s effective tax rate on the dividend?

Effective tax rate

%

c. What is Riverbend’s DRD assuming it owns 36 percent of Hobble Corporation?

DRD

d. Assuming the facts in part (c), what is Riverbend’s marginal tax rate on the dividend?

Marginal tax rate

%

Expert Solution

ekkarill92 answered 8 months ago

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