26. Cattle is a multi-state busines. It has factories in Florida, Georgia and Mississippi. The corporate headquarters are in Texas. It owns rental property in Oklahoma. Cattle would pay state income tax on the Oklahoma rental income in a. Texas and Oklahoma b. Texas only c. Oklahoma only d. all states where it is transacting business. 27. Diego who is a resident and citizen of Peru maintained a bank account at Chase Bank in New York. He was not in US at all during 2018. He earned S6,000 of interest on his money. Diego will a. not pay any US tax on his interest income b. pay the IRS the tax on the $6,000 c. pay the IRS the tax on the $6,000 less the tax paid to Peru on it d. pay the IRS a tax based on his domestic (Peruvian) income 28. Edward, a citizen of the US works for Delta Airlines as the local manager of the Delta operations in Heathrow airport, London, England. Except for ten days of corporate meeting at Delta headquarters in Kentucky, he was not in the US during 2019. For 2019 he a. will include his salary on his US tax return and get a credit for tax paid to England b. exclude his salary from his US tax return c, either a or b d. include his salary and get a foreign tax credit. 29. Which of the following taxes paid to a foreign government would qualify for foreign tax credit a. income tax b. sales tax c. value added tax d. all qualify for foreign tax credit 30. Ford Motor (Detroit car maker) owns 100% of the stock of a Canadian company that builds steering systems for cars. 60% of the production is used to build cars in US, the other 40% is used in other parts of the world. a, 60% of the net profit would be taxed by the IRS b, 60% of gross sales volume would be included in US income for tax purposes c. 100% of net income would be included in US income of Ford Motor d. expenses would be allocated between products used in US and products used in the rest of the world. Gross income less expenses of products used in US would be taxed by IRS 31. For purposes of Estate and Gift Tax, any asset subject to valuation is valued at a. cost b. basis c. adjusted basis d. fair market value