Aqua, a South Carolina corporation, is a 20 percent partner in a Swiss partnership. This year, Aqua earned $2 million U.S. source income and $190,000 foreign source income. It paid no foreign income tax. The Swiss partnership earned $1.73 million foreign source income and paid $460,000 income tax to Switzerland, France, and Austria. Required: Compute Aqua's U.S. tax, assuming the foreign source income does not qualify as FDII. Note: Do not round any intermediate division. Consider intermediate values in dollars and not in millions. Enter your final answer also in dollars and not in millions of dollars. U.S. income tax

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Aqua, a South Carolina corporation, is a 20 percent partner in a Swiss partnership. This year,
Aqua earned $2 million U.S. source income and $190,000 foreign source income. It paid no
foreign income tax. The Swiss partnership earned $1.73 million foreign source income and
paid $460,000 income tax to Switzerland, France, and Austria.
Required:
Compute Aqua's U.S. tax, assuming the foreign source income does not qualify as FDII.
Note: Do not round any intermediate division. Consider intermediate values in dollars and
not in millions. Enter your final answer also in dollars and not in millions of dollars.
U.S. income tax
Transcribed Image Text:Aqua, a South Carolina corporation, is a 20 percent partner in a Swiss partnership. This year, Aqua earned $2 million U.S. source income and $190,000 foreign source income. It paid no foreign income tax. The Swiss partnership earned $1.73 million foreign source income and paid $460,000 income tax to Switzerland, France, and Austria. Required: Compute Aqua's U.S. tax, assuming the foreign source income does not qualify as FDII. Note: Do not round any intermediate division. Consider intermediate values in dollars and not in millions. Enter your final answer also in dollars and not in millions of dollars. U.S. income tax
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