22. The corporate income tax rates in two countries, A and B, are 40 percent and 25 percent, respectively. Additionally, both countries impose a 30 percent withholding tax on dividends paid to foreign investors. However, a bilateral tax treaty between Country A and Page 365 Country B reduces the withholding tax to 10 percent if the dividend is paid to an investor that owns more than 50 percent of the paying company's stock (parent). Both countries use a worldwide approach to taxation but allow taxpayers to take a foreign tax credit for total taxes (income tax plus withholding tax) paid on foreign earned income. The credit is limited to the amount of tax that would have been paid in the domestic country on that income. Both countries use the same currency, so foreign currency translation is not required. Part 1. Alpha Company is headquartered in Country A and has a wholly-owned subsidiary in Country B. In the current year, Alpha's foreign subsidiary generated before-tax income of 100,000 and remitted 100 percent of its net income to the parent company as a dividend. Required: a. Determine the amount of taxes paid in Country A. b. Determine the amount of taxes paid in Country B. Part 2. Beta Company is headquartered in Country B and has a wholly-owned subsidiary in Country A. In the current year, Beta's foreign subsidiary generated before-tax income of 100,000 and remitted 100 percent of its net income to the parent company as a dividend. Required: a. Determine the amount of taxes paid in Country A. b. Determine the amount of taxes paid in Country B