Nexus Tech Industries' Consolidate Earning
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Nexus Tech Industries' Consolidate Earnings. Nexus Tech is a U.S.-based multinational manufacturing firm with wholly-owned subsidiaries in Brazil, Germany, and China, in addition to domestic operations in
the United States. NexusTech is traded on the NASDAQ. NexusTech currently has 650,000 shares outstanding. The basic operating characteristics of the various business units is as follows: Nexus Tech
must pay corporate income tax in each country in which it currently has operations.
a. After deducting taxes in each country, what are Nexus Tech's consolidated earnings and consolidated earnings per share in U.S. dollars?
b. What proportion of Nexus Tech's consolidated earnings arise from each individual country?
c. What proportion of Nexus Tech's consolidated earnings arise from outside the United States?
Transcribed Image Text:Data table
(Click on the following icon in order to copy its contents into a spreadsheet.)
Business Performance (000s)
Earnings before taxes (EBT)
Corporate income tax rate
Average exchange rate for the period
U.S. Parent
(US$)
$4,500
21%
Brazilian
Subsidiary
(reais, R$)
R$6,250
25%
R$1.8 $1.00
German
Subsidiary
(euro, €)
€4,500
40%
€0.7018 $1.00
Chinese
Subsidiary
(yuan, Y)
¥2,500
30%
¥7.75= $1.00
=
X
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