If jills company earns 120000 all of which she will pay to


Jill Meier is the sole owner of Meier Corp., which provides her only source of income. Jill has always paid herself entirely by drawing dividends fom her corporation. A friend suggested that as long as she is earning about what she would have to pay someone else to run the business she, she might be better off paying herself a salary omstead of dividends because she would avoid the problem of double taxation. If Jill's company earns $120,000, all of which she will pay to herself, how much will she take home under each method? Assume a corporate tax rate of 25% on both salary and dividend income.

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Operation Management: If jills company earns 120000 all of which she will pay to
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