Kim Corporation, a calendar year taxpayer, operates manufacturing facilities in State A and State B. A summary of Kim's property holdings are as follows: Beginning of Year State A State B Total Inventory $300,000 $200,000 $500,000 Plant and equipment 2,500,000 1,500,000 4,000,000 Accumulated depreciation: plant and equipment (1,000,000) (600,000) (1,600,000) Land 600,000 1,000,000 1,600,000 Rental property 900,000 300,000 1,200,000 Accumulated depreciation: rental property (200,000) (90,000) (290,000) End of Year Inventory Plant and equipment Accumulated depreciation: plant and equipment State A $400,000 $200,000 State B Total $600,000 2,800,000 1,200,000 4,000,000 (1,200,000) (650,000) (1,850,000) 600,000 1,200,000 1,800,000 1,300,000 Land Rental property 1,000,000 300,000 Accumulated depreciation: rental property (250,000) (100,000) (350,000) *Unrelated to regular business operations. Determine Kim's property factors for the two states. The statutes of both States A and B provide that average historical cost of business property is to be included in the property factor. Round your answers to one decimal place. The property factor for State A is 59.14 X %, and the property factor for State B is 40.86 X % Incorre

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Kim Corporation, a calendar year taxpayer, operates manufacturing facilities in State A and State B. A summary of Kim's
property holdings are as follows:
Beginning of Year
State A
State B
Total
Inventory
$300,000 $200,000
$500,000
Plant and equipment
2,500,000 1,500,000
4,000,000
Accumulated depreciation:
plant and equipment
(1,000,000) (600,000)
(1,600,000)
Land
600,000 1,000,000
1,600,000
Rental property
900,000 300,000
1,200,000
Accumulated depreciation:
rental property
(200,000)
(90,000)
(290,000)
End of Year
Inventory
Plant and equipment
Accumulated depreciation:
plant and equipment
State A
$400,000 $200,000
State B
Total
$600,000
2,800,000 1,200,000
4,000,000
(1,200,000) (650,000) (1,850,000)
600,000 1,200,000 1,800,000
1,300,000
Land
Rental property
1,000,000 300,000
Accumulated depreciation:
rental property
(250,000) (100,000)
(350,000)
*Unrelated to regular business operations.
Determine Kim's property factors for the two states. The statutes of both States A and B provide that average historical cost
of business property is to be included in the property factor.
Round your answers to one decimal place.
The property factor for State A is
59.14 X %, and the property factor for State B is
40.86 X % Incorre
Transcribed Image Text:Kim Corporation, a calendar year taxpayer, operates manufacturing facilities in State A and State B. A summary of Kim's property holdings are as follows: Beginning of Year State A State B Total Inventory $300,000 $200,000 $500,000 Plant and equipment 2,500,000 1,500,000 4,000,000 Accumulated depreciation: plant and equipment (1,000,000) (600,000) (1,600,000) Land 600,000 1,000,000 1,600,000 Rental property 900,000 300,000 1,200,000 Accumulated depreciation: rental property (200,000) (90,000) (290,000) End of Year Inventory Plant and equipment Accumulated depreciation: plant and equipment State A $400,000 $200,000 State B Total $600,000 2,800,000 1,200,000 4,000,000 (1,200,000) (650,000) (1,850,000) 600,000 1,200,000 1,800,000 1,300,000 Land Rental property 1,000,000 300,000 Accumulated depreciation: rental property (250,000) (100,000) (350,000) *Unrelated to regular business operations. Determine Kim's property factors for the two states. The statutes of both States A and B provide that average historical cost of business property is to be included in the property factor. Round your answers to one decimal place. The property factor for State A is 59.14 X %, and the property factor for State B is 40.86 X % Incorre
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