E 10-15 Tax expense—separate tax returns Perro Ltd owns 90 percent of Sinn Ltd, which purchased equipment at $50,000 from Perro when its book value was

$40,000. The equipment depreciated on a straight line basis through 5 years. Shin reports net income of $80,000 and has an income tax liability of $8,000.

ADDITIONAL INFORMATION 1. Tax flat rate is at 34 percent.

2. Perro’s operating income is at $200,000.

REQuIRED 1. Calculate income from Sinn Ltd.

2. Calculate Perro’s income tax expense.

3. Calculate consolidated income tax currently payable.