Luis is the sole shareholder of a corporation, and Eduardo owns a sole proprietorship. Both businesses were started in year 2015, and both make a profit of $80,000 in year 2015. Each owner withdraws $50,000 from his business during the year to pay personal expenses. Which one of the following statements is incorrect?
a. Eduardo must report net profit from his business of $80,000 for 2015.
b. Luis must report dividend income of $80,000 for 2015.
c. Eduardo's proprietorship (as opposed to Eduardo) is not required to pay tax on the $80,000 profit for 2015.
d. Luis's corporation must pay tax on $80,000 for 2015.
e. None of the above.
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