1. George owns a sole proprietorship and Mike is the sole shareholder of a C Corporation. During 2006 both businesses make a profit of $ 75,000 and neither owner withdraws any funds from his business during 2006. How much income must George and Mike report on their individual income tax returns for year 2006?
The solution calculates how much income George and Mike need to report on their individual income tax returns as shareholders of a C Corporation.