Problem 16-41 (LO. 6)Chang Corporation is part of a three-corporation unitary business. The group has a water's edge election in effect with respect to unitaryState Q. State B does not apply the unitary concept with respect to its corporate income tax laws. Nor does Despina, a European country towhich Saldez paid a $7,000,000 value added tax this year.Saldez was organized in Despina and conducts all of its business there. The following is a summary of operations:CorporationCustomers' LocationSalesChang$20,000,00060,000,00070,000,00050,000,000ElenaSaldezState BState QState QDespinaDetermine Chang's and Elena's sales factors in States B and Q.If required, round your final answers to the nearest whole number.State B sales factor:State Q sales factor:40 X %46.67 X %.

Sales factor:The sales factor is a fraction that tells us the number of sales in the State during…

Answered: Chang Corporation is part of a…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Which of the following corporations would not be considered resident in Canada for tax purposes?1)Axem Inc. was incorporated in Manitoba on April 5, 1965 and has carried on business in Canada sincethat date. 2)Linco Ltd. was incorporated in Ontario on April 4, 1985 and, until the end of 1999,all of the operations and board of directors meetings were held in the southern United States. In 2000,all of the management and operations of the Company moved to Toronto. 3)Norad Inc. was incorporated in New York state on March 1, 1985 and, until the end of 1993, carried on business in Canada. At that time, all of the management and operations of the Company moved to the southern United States. 4)Rio Amgal Inc. was incorporated in Manitoba on September 3, 2010. While the Company hasoperations in both Canada and the U.S., the directors live in Calgary. As a consequence, all director’smeetings are held in that city. 5)In all cases the corporations would be considered residents of Canada.
2. Liang Corporation, a U.S. entity, owns 100% of ForCo, a non-U.S. corporation not engaged in a U.S. trade or business. Is Liang subject to any U.S. income tax on her dealings with ForCo? Explain.
Identify the false statement: A. Dividends earned by a resident foreign corporation from a domestic corporation is inter-corporate dividend exempt from income tax. B. Dividends earned by a domestic corporation from a foreign source is inter-corporate dividend exempt from income tax, with certain conditions. C. Dividends earned by a domestic corporation from another domestic corporation is inter-corporate dividend exempt from income tax. D. A corporation may be formed by one person only. E. Every partnership shall be taxed in the same manner as a corporation. F. The share of a partner in the income of a professional partnership shall be subject to regular income tax. G. None of the above.
In appropriate situations the IRS may assert That the Corporation be disregarded as a sham or nominee That income reported by the Corporation belongs on the shareholder’s personal Form 1040 Schedule C under the assignment of income principles. Income is reallocated under §482 to unrelated organizations Tax benefits may be denied under §269 if control of a Corporation is acquired for a purpose of avoiding federal income tax. All of the above All of the above except C All of the above except D All of the above except C & D
Sharon Incorporated is headquartered in State X and owns 100 percent of Carol Corporation, Josey Corporation, and Janice Corporation, which form a single unitary group. Assume sales operations are within the solicitation bounds of Public Law 86-272. Each of the corporations has operations in the following states: Domicile State Dividend income Business income Sales: State X Sales: State Y Sales: State Z Sales: State A Sales: State B Property: State X Property: State Y Property: State Z Property: State A Payroll: State X Payroll: State Y Payroll: State Z Payroll: State A Sharon Carol Josey Incorporated Corporation Corporation State X State Y State Z (throwback) (throwback) (nonthrowback) $ 1,490 $ 525 $ 580 46,250 15,500 59,750 20,300 60,500 75,200 21,900 15,900 60,000 65,000 12,300 28,400 93,500 15,500 55,750 13,400 12,500 7,850 28,000 43,500 3, 150 Janice Corporation State Z (nonthrowback) $ 485 15,700 18,600 12,500 11,700 14, 200 25,500 11,100 10, 200 Compute the following for State…
Identify which of the following statements are true for the corporate form of organization. (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.) ? Corporate income that is distributed to shareholders is usually taxed twice. ? Corporations are often subject to fewer regulations than partnerships. ? The sale of shares from one stockholder to another does not impact operations. An exception is when it changes the makeup of directors. ? It has many of the same rights as an individual. ? It does not end with the death of an owner. ?Stockholders are expected to hire and fire key executives. ? The president and vice presidents choose the board of directors.
Which of the following entities is taxed as a C corporation and will file Form 1120, U.S. Corporation Income Tax Return? (a) Kenneth, Inc., a pass-through entity taxed at the shareholder level. (b) Plushpuppies, Inc., which has made a valid subchapter S election. (c) Minors Financial, an unincorporated organization formed in 1995. Minors has been filing as a corporation since 1995. (d) Rescue Dogs, Inc., which has been recognized as a tax-exempt organization
Under the TRAIN LAW: Government owned and controlled corporation performing proprietary functions are subject to tax a such as:a. GSIS b. SSS c. PHIC d. The local water districts e. Philippine Amusement and Gaming Corporation.f. All of the above
Which of the following is one of the conditions necessary for an amalgamation to result in a tax-free/deferred combination? a. One of the corporations must be a Canadian Corporation. b. Fifty percent of the assets and liabilities of the old corporation must become assets and liabilities of the new corporation. c. The two corporations must be in a similar line of business. d. All of the shareholders of the old corporations must become shareholders of the new corporation.
1 canadian taxation-2 Which of the following scenarios would be most appropriate for a Section 85 rollover? A shareholder of a corporation wishes to transfer property with a fair market value of $150,000 and a tax cost of $100,000 to his corporation. A shareholder of a corporation wishes to transfer property with a fair market value of $100,000 and a tax cost of $150,000 to his corporation. A shareholder of a corporation wishes to transfer property with a fair market value of $150,000 and a tax cost of $100,000 from his corporation. A shareholder of a corporation wishes to transfer property with a fair market value of $100,000 and a tax cost of $150,000 from his corporation.
Given the following facts, what is the state apportionment factor if sales are triple weighted: instate everywhere sales 13 100 property 19 100 payroll 8 100 A. .1325 B. .1300 C. .1333 D. .1320 As discussed in class, which of the following of corporate state tax filing methods is valid? A. Consolidated B. Separate Entity C. Combined D. All of the above E. A and B only Allocated income to a state is taxed at the same rate as apportioned income to a state. True False As discussed in class, trailing nexus can require tax filing even a corporation is without an instate physical presence like inventory or payroll and only has sales into the jurisdiction at issue. True False

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