EuroVirtual's Consolidated Earnings. EuroVirtual is a French-based multinational IT firm. In addition to its home operations in France, EuroVirtual owns and operates subsidiaries in Switzerland, the United Kingdom, and Denmark. It has 647,000 shares currently outstanding on the pan-European stock exchange: Euronext. The following table summarizes the business performance of EuroVirtual: (Click on the icon to import the table into a spreadsheet.) French Parent Company (euros, ) Swiss Subsidiary (Swiss franc, CHF) UK Subsidiary (British Pound GBP) Danish Subsidiary (Danish krone, DKK) Earnings before taxes (EBT) in 000s of domestic currency Corporate income tax rate Average cross rate per EUR1 2,520 33.3% 450 25% 1.0379 2,100 20% 0.7465 4.460 23% 7.4242 EuroVirtual pays different tax rates for each of its country operations. All MNEs attempt to minimize their global tax liabilities. a) What are its earnings per share in EUR after deducting taxes? b) What is the total corporate income tax that EuroVirtual pays for all its operations in eu c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? SLIM a) What are its earnings per share in EUR after deducting taxes? First, calculate net profits of individual subsidiaries in local currency below (Round to two decimal places) French Parent Swiss UK Danish Company Subsidiary Subsidiary (CHF) Subsidiary (GBP) Business Performance (000s) () (DKK) 4,460.00 Earnings before taxes, EBT 2,520.00 450.00 2,100.00 33.3% Less corporate income taxes 25% 20% 23% Net profits in local currency EuroVirtual's Consolidated Earnings. EuroVirtual is a French-based multinational IT firm. In addition to its home operations in France, EuroVirtual owns and operates subsidiaries in Switzerland, the United Kingdom, and Denmark. It has 647 000 shares currently outstanding on the pan-European stock exchange Euronext. The following table summarizes the business performance of EuroVirtual: (Click on the icon to import the table into a spreadsheet.) French Parent Company (euros, ) Swiss Subsidiary (Swiss franc, CHF) UK Subsidiary (British Pound, GBP) Danish Subsidiary (Danish Krone, DKK) 450 Earnings before taxes (EBT) in 000s of domestic currency Corporate income tax rate Average cross rate per EUR1 2,520 33.3% 25% 1.0379 2,100 20% 0.7465 4,460 23% 7.4242 EuroVirtual pays different tax rates for each of its country operations. All MNEs attempt to minimize their global tax liabilities. a) What are its earnings per share in EUR after deducting taxes? b) What is the total corporate income tax that EuroVirtual pays for all its operations in euros? c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? French Parent Swiss UK Danish Company Subsidiary (CHF) Subsidiary (GBP) Subsidiary (DKK) Business Performance (000s) () Net profits in local currency 1.0379 0.7465 7.4242 Average exchange rate (fc/euro) Net profits in euros Next, we calculate the consolidated net profits in euros. The consolidated net profits in euros are (000s) (Round to two decimal places.) EuroVirtual's Consolidated Earnings. EuroVirtual is a French-based multinational IT firm. In addition to its home operations in France, EuroVirtual owns and operates subsidiaries in Switzerland, the United Kingdom, and Denmark. It has 647,000 shares currently outstanding on the pan-European stock exchange: Euronext. The following table summarizes the business performance of EuroVirtual: (Click on the icon to import the table into a spreadsheet) French Parent Company (euros, ) Swiss Subsidiary (Swiss franc, CHF) UK Subsidiary (British Pound, GBP) Danish Subsidiary (Danish krone, DKK) Earnings before taxes (EBT) in 000s of domestic currency Corporate income tax rate Average cross rate per EUR1 2,520 33.3% 450 25% 1.0379 2.100 20% 0.7465 4,460 23% 7.4242 EuroVirtual pays different tax rates for each of its country operations. All MNEs attempt to minimize their global tax liabilities. a) What are its earnings per share in EUR after deducting taxes? b) What is the total corporate income tax that EuroVirtual pays for all its operations in euros? c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? The consolidated net profits in euros are (000s) (Round to two decimal places.) Last, we calculate the earnings per share in euros. The amount of earnings per share in euros is ) (Round to two decimal places.) b) What is the total corporate income tax that EuroVirtual pays for all its operations in euros? Calculate the tax payments in euros below. (Round to two decimal places.) French Parent Swiss UK Danish Company Subsidiary Subsidiary Subsidiary EuroVirtual's Consolidated Earnings. EuroVirtual is a French-based multinational IT firm. In addition to its home operations in France, EuroVirtual owns and operates subsidiaries in Switzerland, the United Kingdom, and Denmark. It has 647,000 shares currently outstanding on the pan-European stock exchange Euronext. The following table summarizes the business performance of EuroVirtual: (Click on the icon to import the table into a spreadsheet.) French Parent Company (euros, C) Swiss Subsidiary (Swiss franc, CHF) UK Subsidiary (British Pound, GBP) Danish Subsidiary (Danish Krone, DKK) Earnings before taxes (EBT) in 000s of domestic currency Corporate income tax rate Average cross rate per EUR1 2,520 33.3% 450 25% 1.0379 2,100 20% 0.7465 4,460 23% 7.4242 EuroVirtual pays different tax rates for each of its country operations. All MNEs attempt to minimize their global tax liabilities a) What are its earnings per share in EUR after deducting taxes? b) What is the total corporate income tax that EuroVirtual pays for all its operations in euros? c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? 4 French Parent Swiss UK Danish Subsidiary Subsidiary Company () Subsidiary (GBP) (CHF) (DKK) 33 3% 839.16 25% 112.50 20% 420.00 23% 1,025 80 Corporate income tax (000s) Corporate income taxes in fc Average exchange rate (fcleuro) Tax payments by country in euros 1.0379 0.7465 7.4242 (Round to two decimal places.) The total corporate income tax is (000s) EuroVirtual's Consolidated Earnings. EuroVirtual is a French-based multinational IT firm. In addition to its home operations in France, EuroVirtual owns and operates subsidiaries in Switzerland, the United Kingdom, and Denmark. It has 647,000 shares currently outstanding on the pan-European stock exchange: Euronext. The following table summarizes the business performance of EuroVirtual: (Click on the icon to import the table into a spreadsheet) French Parent Company (euros, ) Swiss Subsidiary (Swiss franc, CHF) UK Subsidiary (British Pound, GBP) Danish Subsidiary (Danish krone, DKK) Earnings before taxes (EBT) in 000s of domestic currency Corporate income tax rate Average cross rate per EUR1 2,520 33.3% 450 25% 1.0379 2,100 20% 0.7465 4,460 23% 7.4242 EuroVirtual pays different tax rates for each of its country operations. All MNEs attempt to minimize their global tax liabilities. a) What are its earnings per share in EUR after deducting taxes? b) What is the total corporate income tax that EuroVirtual pays for all its operations in euros? c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? Calculate EBT by country in euros below. (Round to two decimal places.) French Parent Swiss UK Danish Company () Subsidiary (CHF) Subsidiary (GBP) Earnings before taxes (000s) Earnings before taxes, EBT Subsidiary (DKK) 4.460.00 2,520.00 450.00 2,100.00 1.0379 0.7465 7.4242 Average exchange rate (fcleuro) EBT by country in euros EuroVirtual's Consolidated Earnings. EuroVirtual is a French-based multinational IT firm. In addition to its home operations in France, EuroVirtual owns and operates subsidiaries in Switzerland, the United Kingdom, and Denmark. It has 647,000 shares currently outstanding on the pan-European stock exchange Euronext. The following table summarizes the business performance of EuroVirtual: (Click on the icon to import the table into a spreadsheet) French Parent Company (euros, ) Swiss Subsidiary (Swiss franc, CHF) UK Subsidiary (British Pound, GBP) Danish Subsidiary (Danish krone, DKK) Earnings before taxes (EBT) in 000s of domestic currency Corporate income tax rate Average cross rate per EUR1 2,520 33.3% 450 25% 10379 2,100 20% 0.7465 4,460 23% 7.4242 EuroVirtual pays different tax rates for each of its country operations. AllMNEs attempt to minimize their global tax liabilities. a) What are its earnings per share in EUR after deducting taxes? b) What is the total corporate income tax that EuroVirtual pays for all its operations in euros? c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? () (CHF) (GBP) (DKK) Earnings before taxes (000s) Earnings before taxes EBT 2.520.00 450.00 2,100.00 4.460.00 Average exchange rate (fcleuro) 1.0379 0.7465 7 4242 EBT by country in euros The consolidated EBT in euros is (000s) (Round to two decimal places) The effective tax rate is %. (Round to two decimal places.) d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? Calculate the new net profits of the UK subsidiary in euros below. (Round to two decimal places.) EuroVirtual's Consolidated Earnings. EuroVirtual is a French-based multinational IT firm. In addition to its home operations in France, EuroVirtual owns and operates subsidiaries in Switzerland, the United Kingdom, and Denmark. It has 647 000 shares currently outstanding on the pan-European stock exchange. Euronext. The following table summarizes the business performance of EuroVirtual: (Click on the icon to import the table into a spreadsheet) French Parent Company (euros, ) Swiss Subsidiary (Swiss franc, CHF) UK Subsidiary (British Pound, GBP) Danish Subsidiary (Danish krone, DKK) Eamings before taxes (EBT) in 000s of domestic currency Corporate income tax rate Average cross rate per EUR1 2.520 33.3% 450 25% 1.0379 2,100 20% 0.7465 4,460 23% 7.4242 EuroVirtual pays different tax rates for each of its country operations. All MNEs attempt to minimize their global tax liabilities a) What are its earnings per share in EUR after deducting taxes? b) What is the total corporate income tax that EuroVirtual pays for all its operations in euros? c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? SH UK Subsidiary (GBP) Business Performance (000s) Earnings before taxes, EBT 3,150.00 Less corporate income taxes 10% Net profits in local currency Average exchange rate (fc/euro) Net profits in euros 0.7465 The new consolidated net profits in euros (000s) are (Round to two decimal places.) EuroVirtual's Consolidated Earnings. EuroVirtual is a French-based multinational IT firm. In addition to its home operations in France, EuroVirtual owns and operates subsidiaries in Switzerland, the United Kingdom, and Denmark. It has 647,000 shares currently outstanding on the pan-European stock exchange Euronext. The following table summarizes the business performance of EuroVirtual: (Click on the icon to import the table into a spreadsheet) French Parent Company (euros, ) Swiss Subsidiary (Swiss franc, CHF) UK Subsidiary (British Pound, GBP) Danish Subsidiary (Danish Krone, DKK) Earnings before taxes (EBT) in 000s of domestic currency Corporate income tax rate Average cross rate per EUR1 2,520 33.3% 450 25% 1.0379 2,100 20% 0.7465 4.460 23% 7.4242 EuroVirtual pays different tax rates for each of its country operations. All MNEs attempt to minimize their global tax liabilities a) What are its earnings per share in EUR after deducting taxes? b) What is the total corporate income tax that EuroVirtual pays for all its operations in euros? c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? ES 3,150.00 10% Earnings before taxes, EBT Less corporate income taxes Net profits in local currency Average exchange rate (fc/euro) Net profits in euros 0.7465 (Round to two decimal places.) The new consolidated net profits in euros (000s) are The new earnings per share in euros are e (Round to two decimal places.) The earnings per share change from baseline is 3%. (Round to two decimal places.) EuroVirtual's Consolidated Earnings. EuroVirtual is a French-based multinational IT firm. In addition to its home operations in France, EuroVirtual owns and operates subsidiaries in Switzerland, the United Kingdom, and Denmark. It has 647,000 shares currently outstanding on the pan-European stock exchange: Euronext. The following table summarizes the business performance of EuroVirtual: (Click on the icon to import the table into a spreadsheet.) French Parent Company (euros, ) Swiss Subsidiary (Swiss franc, CHF) UK Subsidiary (British Pound GBP) Danish Subsidiary (Danish krone, DKK) Earnings before taxes (EBT) in 000s of domestic currency Corporate income tax rate Average cross rate per EUR1 2,520 33.3% 450 25% 1.0379 2,100 20% 0.7465 4.460 23% 7.4242 EuroVirtual pays different tax rates for each of its country operations. All MNEs attempt to minimize their global tax liabilities. a) What are its earnings per share in EUR after deducting taxes? b) What is the total corporate income tax that EuroVirtual pays for all its operations in eu c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? SLIM a) What are its earnings per share in EUR after deducting taxes? First, calculate net profits of individual subsidiaries in local currency below (Round to two decimal places) French Parent Swiss UK Danish Company Subsidiary Subsidiary (CHF) Subsidiary (GBP) Business Performance (000s) () (DKK) 4,460.00 Earnings before taxes, EBT 2,520.00 450.00 2,100.00 33.3% Less corporate income taxes 25% 20% 23% Net profits in local currency EuroVirtual's Consolidated Earnings. EuroVirtual is a French-based multinational IT firm. In addition to its home operations in France, EuroVirtual owns and operates subsidiaries in Switzerland, the United Kingdom, and Denmark. It has 647 000 shares currently outstanding on the pan-European stock exchange Euronext. The following table summarizes the business performance of EuroVirtual: (Click on the icon to import the table into a spreadsheet.) French Parent Company (euros, ) Swiss Subsidiary (Swiss franc, CHF) UK Subsidiary (British Pound, GBP) Danish Subsidiary (Danish Krone, DKK) 450 Earnings before taxes (EBT) in 000s of domestic currency Corporate income tax rate Average cross rate per EUR1 2,520 33.3% 25% 1.0379 2,100 20% 0.7465 4,460 23% 7.4242 EuroVirtual pays different tax rates for each of its country operations. All MNEs attempt to minimize their global tax liabilities. a) What are its earnings per share in EUR after deducting taxes? b) What is the total corporate income tax that EuroVirtual pays for all its operations in euros? c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? French Parent Swiss UK Danish Company Subsidiary (CHF) Subsidiary (GBP) Subsidiary (DKK) Business Performance (000s) () Net profits in local currency 1.0379 0.7465 7.4242 Average exchange rate (fc/euro) Net profits in euros Next, we calculate the consolidated net profits in euros. The consolidated net profits in euros are (000s) (Round to two decimal places.) EuroVirtual's Consolidated Earnings. EuroVirtual is a French-based multinational IT firm. In addition to its home operations in France, EuroVirtual owns and operates subsidiaries in Switzerland, the United Kingdom, and Denmark. It has 647,000 shares currently outstanding on the pan-European stock exchange: Euronext. The following table summarizes the business performance of EuroVirtual: (Click on the icon to import the table into a spreadsheet) French Parent Company (euros, ) Swiss Subsidiary (Swiss franc, CHF) UK Subsidiary (British Pound, GBP) Danish Subsidiary (Danish krone, DKK) Earnings before taxes (EBT) in 000s of domestic currency Corporate income tax rate Average cross rate per EUR1 2,520 33.3% 450 25% 1.0379 2.100 20% 0.7465 4,460 23% 7.4242 EuroVirtual pays different tax rates for each of its country operations. All MNEs attempt to minimize their global tax liabilities. a) What are its earnings per share in EUR after deducting taxes? b) What is the total corporate income tax that EuroVirtual pays for all its operations in euros? c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? The consolidated net profits in euros are (000s) (Round to two decimal places.) Last, we calculate the earnings per share in euros. The amount of earnings per share in euros is ) (Round to two decimal places.) b) What is the total corporate income tax that EuroVirtual pays for all its operations in euros? Calculate the tax payments in euros below. (Round to two decimal places.) French Parent Swiss UK Danish Company Subsidiary Subsidiary Subsidiary EuroVirtual's Consolidated Earnings. EuroVirtual is a French-based multinational IT firm. In addition to its home operations in France, EuroVirtual owns and operates subsidiaries in Switzerland, the United Kingdom, and Denmark. It has 647,000 shares currently outstanding on the pan-European stock exchange Euronext. The following table summarizes the business performance of EuroVirtual: (Click on the icon to import the table into a spreadsheet.) French Parent Company (euros, C) Swiss Subsidiary (Swiss franc, CHF) UK Subsidiary (British Pound, GBP) Danish Subsidiary (Danish Krone, DKK) Earnings before taxes (EBT) in 000s of domestic currency Corporate income tax rate Average cross rate per EUR1 2,520 33.3% 450 25% 1.0379 2,100 20% 0.7465 4,460 23% 7.4242 EuroVirtual pays different tax rates for each of its country operations. All MNEs attempt to minimize their global tax liabilities a) What are its earnings per share in EUR after deducting taxes? b) What is the total corporate income tax that EuroVirtual pays for all its operations in euros? c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? 4 French Parent Swiss UK Danish Subsidiary Subsidiary Company () Subsidiary (GBP) (CHF) (DKK) 33 3% 839.16 25% 112.50 20% 420.00 23% 1,025 80 Corporate income tax (000s) Corporate income taxes in fc Average exchange rate (fcleuro) Tax payments by country in euros 1.0379 0.7465 7.4242 (Round to two decimal places.) The total corporate income tax is (000s) EuroVirtual's Consolidated Earnings. EuroVirtual is a French-based multinational IT firm. In addition to its home operations in France, EuroVirtual owns and operates subsidiaries in Switzerland, the United Kingdom, and Denmark. It has 647,000 shares currently outstanding on the pan-European stock exchange: Euronext. The following table summarizes the business performance of EuroVirtual: (Click on the icon to import the table into a spreadsheet) French Parent Company (euros, ) Swiss Subsidiary (Swiss franc, CHF) UK Subsidiary (British Pound, GBP) Danish Subsidiary (Danish krone, DKK) Earnings before taxes (EBT) in 000s of domestic currency Corporate income tax rate Average cross rate per EUR1 2,520 33.3% 450 25% 1.0379 2,100 20% 0.7465 4,460 23% 7.4242 EuroVirtual pays different tax rates for each of its country operations. All MNEs attempt to minimize their global tax liabilities. a) What are its earnings per share in EUR after deducting taxes? b) What is the total corporate income tax that EuroVirtual pays for all its operations in euros? c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? Calculate EBT by country in euros below. (Round to two decimal places.) French Parent Swiss UK Danish Company () Subsidiary (CHF) Subsidiary (GBP) Earnings before taxes (000s) Earnings before taxes, EBT Subsidiary (DKK) 4.460.00 2,520.00 450.00 2,100.00 1.0379 0.7465 7.4242 Average exchange rate (fcleuro) EBT by country in euros EuroVirtual's Consolidated Earnings. EuroVirtual is a French-based multinational IT firm. In addition to its home operations in France, EuroVirtual owns and operates subsidiaries in Switzerland, the United Kingdom, and Denmark. It has 647,000 shares currently outstanding on the pan-European stock exchange Euronext. The following table summarizes the business performance of EuroVirtual: (Click on the icon to import the table into a spreadsheet) French Parent Company (euros, ) Swiss Subsidiary (Swiss franc, CHF) UK Subsidiary (British Pound, GBP) Danish Subsidiary (Danish krone, DKK) Earnings before taxes (EBT) in 000s of domestic currency Corporate income tax rate Average cross rate per EUR1 2,520 33.3% 450 25% 10379 2,100 20% 0.7465 4,460 23% 7.4242 EuroVirtual pays different tax rates for each of its country operations. AllMNEs attempt to minimize their global tax liabilities. a) What are its earnings per share in EUR after deducting taxes? b) What is the total corporate income tax that EuroVirtual pays for all its operations in euros? c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? () (CHF) (GBP) (DKK) Earnings before taxes (000s) Earnings before taxes EBT 2.520.00 450.00 2,100.00 4.460.00 Average exchange rate (fcleuro) 1.0379 0.7465 7 4242 EBT by country in euros The consolidated EBT in euros is (000s) (Round to two decimal places) The effective tax rate is %. (Round to two decimal places.) d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? Calculate the new net profits of the UK subsidiary in euros below. (Round to two decimal places.) EuroVirtual's Consolidated Earnings. EuroVirtual is a French-based multinational IT firm. In addition to its home operations in France, EuroVirtual owns and operates subsidiaries in Switzerland, the United Kingdom, and Denmark. It has 647 000 shares currently outstanding on the pan-European stock exchange. Euronext. The following table summarizes the business performance of EuroVirtual: (Click on the icon to import the table into a spreadsheet) French Parent Company (euros, ) Swiss Subsidiary (Swiss franc, CHF) UK Subsidiary (British Pound, GBP) Danish Subsidiary (Danish krone, DKK) Eamings before taxes (EBT) in 000s of domestic currency Corporate income tax rate Average cross rate per EUR1 2.520 33.3% 450 25% 1.0379 2,100 20% 0.7465 4,460 23% 7.4242 EuroVirtual pays different tax rates for each of its country operations. All MNEs attempt to minimize their global tax liabilities a) What are its earnings per share in EUR after deducting taxes? b) What is the total corporate income tax that EuroVirtual pays for all its operations in euros? c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? SH UK Subsidiary (GBP) Business Performance (000s) Earnings before taxes, EBT 3,150.00 Less corporate income taxes 10% Net profits in local currency Average exchange rate (fc/euro) Net profits in euros 0.7465 The new consolidated net profits in euros (000s) are (Round to two decimal places.) EuroVirtual's Consolidated Earnings. EuroVirtual is a French-based multinational IT firm. In addition to its home operations in France, EuroVirtual owns and operates subsidiaries in Switzerland, the United Kingdom, and Denmark. It has 647,000 shares currently outstanding on the pan-European stock exchange Euronext. The following table summarizes the business performance of EuroVirtual: (Click on the icon to import the table into a spreadsheet) French Parent Company (euros, ) Swiss Subsidiary (Swiss franc, CHF) UK Subsidiary (British Pound, GBP) Danish Subsidiary (Danish Krone, DKK) Earnings before taxes (EBT) in 000s of domestic currency Corporate income tax rate Average cross rate per EUR1 2,520 33.3% 450 25% 1.0379 2,100 20% 0.7465 4.460 23% 7.4242 EuroVirtual pays different tax rates for each of its country operations. All MNEs attempt to minimize their global tax liabilities a) What are its earnings per share in EUR after deducting taxes? b) What is the total corporate income tax that EuroVirtual pays for all its operations in euros? c) What is its effective tax rate (total taxes paid as a percentage of pre-tax earnings)? d) Suppose the United Kingdom decides to reduce its corporate tax rate to 10%, leading to a rise in EuroVirtual's British subsidiary's earnings before tax to GBP3,150,000. What would be the impact on EuroVirtual's EPS? ES 3,150.00 10% Earnings before taxes, EBT Less corporate income taxes Net profits in local currency Average exchange rate (fc/euro) Net profits in euros 0.7465 (Round to two decimal places.) The new consolidated net profits in euros (000s) are The new earnings per share in euros are e (Round to two decimal places.) The earnings per share change from baseline is 3%. (Round to two decimal places.)