Herger Corporation does business in California, Nevada, and Oregon, and has nexus in these states as well. Herger’s California state tax base was $943,500 after making the required federal/state adjustments. Herger’s federal tax return contains the following items:Item$Federal T-note interest income5,900Nevada municipal bond interest income3,690California municipal bond interest income5,500Interest expense related to T-note interest income1,540Royalty income181,000Travel expenses10,100Determine Herger’s California business income.

As the name suggests, business revenue is money created by a firm. According to the Internal Revenue…

Answered: Herger Corporation does business in…

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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Herger Corporation does business in California, Nevada, and Oregon, and has nexus in these states as well. Herger’s California state tax base was $943,500 after making the required federal/state adjustments. Herger’s federal tax return contains the following items:

Item	$
Federal T-note interest income	5,900
Nevada municipal bond interest income	3,690
California municipal bond interest income	5,500
Interest expense related to T-note interest income	1,540
Royalty income	181,000
Travel expenses	10,100

Determine Herger’s California business income.

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