Country Type of operation Gross earnings Income tax rate United states Parent 500,000 40% Branch (10,000) 25% Y Distribution 120,000 5% 100%-owned 400,000 45% abc's subsidiary in z declares a 40 percent dividend: z's withholding tax on dividends is 5 percent. both the branch and the distribution facility, which is wholly owned, retain all earnings. the distribution earnings are considered to be foreign-based company sales income. what is abc's final u.s. tax liability?

Country Type of operation Gross earnings Income tax rate United states Parent 500,000 40% Branch (10,000) 25% Y Distribution 120,000 5% 100%-owned 400,000 45% abc's subsidiary in z declares a 40 percent dividend: z's withholding tax on dividends is 5 percent. both the branch and the distribution facility, which is wholly owned, retain all earnings. the distribution earnings are considered to be foreign-based company sales income. what is abc's final u.s. tax liability?

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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