Chinglish Dirk (A). Chinglish Dirk Company (Hong Kong) exports razor blades to its wholly owned parent company, Torrington Edge (Great Britain). Hong Kong tax rates are 19% and British tax rates are 30%. The markup was 15% and the sales volume was 2,500 units. Chinglish calculates its profit per container as follows (all values in British pounds): 1. Corporate management of Torrington Edge is considering repositioning profits within the multinational company. What happens to the profits of Chinglish Dirk and Torrington Edge, and the consolidated results of both, if the markup at Chinglish was increased to 20% and the markup at Torrington was reduced to 10%? What is the impact of this repositioning on consolidated after-tax profit and total tax payments? Calculate the profits of Chinglish Dirk and Torrington Edge, and the consolidated results of both, if the markup at Chinglish was increased to 20% and the markup at Torrington was reduced to 10% in the following table: (Round to the nearest British pound.) Consolidated Constructing Transfer (Sales) Price per Unit Chinglish Dirk (British pounds) Torrington Edge (British pounds) (British pounds) Direct costs 13,000 Overhead 3,600 1,400 Total costs 16,600 Desired markup Transfer price (sales price) Income Statement Sales price Less total costs Taxable income Less taxes Profit, after-tax What is the impact of this repositioning on consolidated after-tax profit and total tax payments? (Select from the drop-down menus.) By increasing the markup in Hong Kong, the company has (1) lower tax environment in Hong Kong. 1: Data Table its consolidated income taxes and repositioned (2). of its profits in the