5. Your client is a manufacturing firm that has its principal facilities in CA with an 8.84% tax rate. It locates a new plant in AZ with a 4.9% tax rate. They provide the below data and ask for your professional opinion. Write an IOM to the firm's management team giving your recommendation about the collateral effects on income tax apportionment. (15 points) AZ state income tax rate for corporate is 4.9% and CA is 8.84% Data CA (old) Plant (in millions) AZ (new) Plant (in 9 millions) New income 80 40 Sales 100 100 Property 75 50 Payroll 50 30 Additional Information: Assuming the firm did not previously have nexus in AZ, the change in income tax would be as follow: Tax before AZ plant $80 x 4.9% = $3.92 M