Problem 13-21 (Algo) [LO 13-5]Comet operates solely within the United States. It owns two subsidiaries conducting business in the United States aeveral foreign countries. Both subsidiaries are U.S. corporations. This year, the three corporations report the followForeignSourceU.S.SourceForeignIncome TaxPaidIncomeIncome$Comet00635,000$$Sub 1230,0004,010,000386,000Sub 2 4,080,000465,0001,265,000"equired:If Comet and its two subsidiaries file a consolidated U.S. tax return, compute consolidated income tax.What is the aggregate tax of the group if the three corporations file separate U.S. tax returns?> Answer is complete but not entirely correct.Complete this question by entering your answers in the tabs below.Required RequiredABWhat is the aggregate tax of the group if the three corporations file separate U.S. taxreturns?Note: Do not round any intermediate calculations.Aggregate$Cax2,093,100Show less▲

Here's a breakdown of how the tax is calculated for each corporation:Comet: $635,000 (U.S. source…

Answered: Problem 13-21 (Algo) [LO 13-5] Comet…

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 is NOT income tax exempt? * BOI-registered enterprise enjoying tax holiday Forex transaction income of a Foreign Currency Depositary Unit from another Foreign Currency Depositary Unit Forex income in the Philippines of an Offshore Banking Unit Regional area headquarter of a multinational company None of the Above
Problem 24-42 (LO 24-1) (Algo) Waco Leather Incorporated, a U.S. corporation, reported total taxable income of $4.8 million. Taxable income included $1.36 million of foreign source taxable income from the company's branch operations in Mexico. All of the branch income is foreign branch income. Waco paid Mexican income taxes of $244,800 on its branch income. Return to question Compute Waco's allowable foreign tax credit. Note: Enter your answer in dollars and not in millions of dollars. X Answer is complete but not entirely correct. Foreign tax credit $ 285,600
Mf2. Prior to the 2017 tax act, many U.S. multinational corporations kept profits abroad in the form of cash rather than returning them to the U.S. A major motive for this was the fact that under the U.S. tax code: A.foreign branch earnings were taxed only when funds were transferred to the parent. B.foreign subsidiary earnings were taxed only when funds were transferred to the parent. C.branch and subsidiary earnings were taxed only when transferred to the parent. D none of the above.
Translation and Remeasurement Gains and Losses Amcrest France Sarl, located in Paris France, is a financial subsidiary of Target Corporation, a U.S. company. Amcrest's accounts are re- ported in euros. Assume that the following data relate to Amcrest's activities for 2020 (in millions). €(15,000) 5,400 Net monetary liabilities, beginning of year. Net assets, beginning of year.. Transactions during 2020: Sales.... 72,000 59,000 ...... Inventory purchases.. Depreciation and amortization Cost of sales..... Cash operating expenses.. Dividends declared and paid New long-term interest borrowings 1,000 61,000 9,500 100 300 Sales, inventory purchases, and cash operating expenses were reported evenly throughout the year. Exchange rates are as follows ($/€): Beginning of 2020 Average for 2020 End of 2020 $1.30 1.24 1.20 ... .. Rate when assets related to depreciation and amortization were acquired Rate when dividends declared...... Rate when long-term interest borrowings occurred 1.45 1.21 1.25…
Certain balance sheet accounts of a foreign subsidiary of Orchid Company have been stated in U.S. dollars as follows: Stated at Current Rates Historical Rates Accounts receivable, current $ 155,000 $ 175,000 Accounts receivable, long term 108,000 115,000 Land 54,000 59,000 Patents 83,000 88,000 $ 400,000 $ 437,000 This subsidiary’s functional currency is the U.S. dollar. What total should Orchid’s balance sheet include for the preceding items?
1. ForCo, a corporation that is incorporated in a foreign country that does not have a treaty with the United States, plans to conduct manufacturing, marketing, and sales operations in the United States. These U.S. operations produce $5 million of earnings & profits in Year 1. Assume further that the U.S. operations will have a net worth of $17 million at the beginning of Year 1 and $20 million at the end of Year 1. During Year 2, the U.S. branch does not produce any earnings & profits and its net worth is $20 million at the beginning of the year and $10 million at the end of the year. For branch profits tax purposes in Year 1, the dividend equivalent amount (“DEA”) for the U.S. branch is as follows: a. $1.5 million. b. $2.0 million c. $10 million. $20 million. d. $25 million. 2. For branch profits tax purposes in Year 2, the DEA for the U.S. branch is as follows: a. $2 million. b. $3 million. c. $10 million. d. $20 million. e. $25 million.…
13-An Omani establishment has drawn an invoice of RO 5,400 on account of a foreign sub-contractor. The amount payable to a foreign sub-contractor is RO 5,400. The WHT (Withholding Tax) is Payable @ 10%. Which one of the following is WHT as per Oman tax laws? a. RO 6,600 O b. None of the options O c. RO 6,000 O d. RO 600
MC Topic: Income Taxation Identify a false statement: * Capital Gains Tax is a tax imposed on the gains realized by the seller from the sale, exchange, or other disposition of certain capital assets located in the Philippines, including pacto de retro sales and other forms of conditional sale. Under NIRC, the capital gains tax on the sale of domestic stocks sold directly to buyer is a final tax. Under NIRC, The capital gains tax on the sale of real property located in the Philippines and classified as capital asset is a final tax. None of the above All of the above
ZAX, resident foreign corporation, reports the following: Philippines P15,000,000 P25,000,000 1,500,000 Abroad Gross income from business Dividends from ABC domestic corporation Dividends form DEF foreign corporation Interest on long-term deposits Rentals on properties Total 3.000,000 25,000 2,000,000 | P17,450,000| P30.025.000 | 50,000 900,000 Compute the gross income of ZAX subject to regular income tax in the Philippines. a. P15,000,000 b. P15,900,000 c. P17,450,000 d. P47,475,000
Question 4 A multinational Corporation based in the United States of America has subsidiaries in the UK, Canada, and France. As at December 31, 2020, inter-company indebtedness were as follows: Debtors Creditors Amount Currency UK Canada 1,500,000 Can$ UK France 600,000 Euro (€) France Canada 800,000 Can$ Canada UK 94,000 Sterling (£) Canada France 400,000 Euro (€) It is the policy company's policy to net off inter-company balances to the greatest extent possible. The central treasury department is to use the following exchange rates for these purposes: US$1 =Can$1.237/€0.8620/£0.729 Required: Calculate the net payment to be made between the subsidiaries after netting off inter-company balances, by presenting the payoff in a matrix/table format. Hints: Convert in a common currency and note that the Debtor company always pays the creditor company.
Qd 210.
22. A domestic corporation has a net income of P1,200,000 in the Philippines and P800,000 from abroad. Compute the income tax due

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