During the current year, Pearlene Monroig earns business income in the U.K. of 10,000 from which the British government withholds 2,000. Assume that the relevant exchange rate was 1.00 = $1.70 for the year. Which of the following statements is correct?

Select one:

A.

Pearlene will have foreign source net business income of $17,000 and no credit against Tax Payable.

B.

Pearlene will have foreign source net business income of $17,000 and a credit against Tax Payable of $3,400.

C.

Pearlene will have foreign source net business income of $13,600 and a credit against Tax Payable of $3,400.

D.

Pearlene will have foreign source net business income of $16,150 and a credit against Tax Payable of $2,550.

Clear my choice