Answered

IDNLearn.com provides a comprehensive platform for finding accurate answers. Our community provides accurate and timely answers to help you understand and solve any issue.

Spartan Corporation, a U.S. corporation, reported $6.5 million of pretax income from its business operations in Spartania, which were conducted through a foreign branch. Spartania taxes branch income at 15 percent, and the United States taxes corporate income at 21 percent. Required: a. If the United States provided no mechanism for mitigating double taxation, what would be the total tax (U.S. and foreign) on the $6.5 million of branch profits

Sagot :

Parrainidn

Answer: $2,340,000

Explanation:

Spartania Tax on branch income:

= 15% * 6,500,000

= $975,000

U.S. Corporate tax:

= 21% * 6,500,000

= $1,365,000

Total tax:

= 975,000 + 1,365,000

= $2,340,000

We appreciate your participation in this forum. Keep exploring, asking questions, and sharing your insights with the community. Together, we can find the best solutions. Find the answers you need at IDNLearn.com. Thanks for stopping by, and come back soon for more valuable insights.