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Mandarini Mandarini
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7 years ago
Eight individuals own Navy Corporation, a C corporation. Three shareholders make up the board of directors and own 51% of the stock. The corporation has a successful manufacturing business. It has accumulated $3 million of E&P and expects to accumulate another $200,000 of E&P annually. Annual dividend payments are $30,000. Demand for Navy's goods has been strong, but the company does not anticipate any expansion or repair of the current plant for three to five years. Management has invested $200,000 annually in growth stocks. Its current investment portfolio is $1.2 million. The portfolio is held as protection against a business slowdown. Loans to shareholder-employees currently are $400,000. As Navy's CPA, what tax issues should you have your client consider?
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Prentice Hall's Federal Taxation 2014 Corporations, Partnerships, Estates & Trusts

Prentice Hall's Federal Taxation 2014 Corporations, Partnerships, Estates & Trusts


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genflynngenflynn
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This verified answer contains over 300 words.
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We have the most crude accounting tools. It's tragic because our accounts and our national arithmetic doesn't tell us the things that we need to know.

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Mandarini Author
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7 years ago
Thank you, thank you, thank you!
lubennick
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Yesterday
I appreciate what you did here, answered it right Smiling Face with Open Mouth
rene_ram97
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2 hours ago
Thanks
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