Hi, Im trying to figure out the Hozho (A) case however Im having some trouble figuring out how to do Exhibit 3 and 4. Ive attached how far ive gotten in Exhibit 3 but im not sure if im on the correct track any information would be greatly appreciated. https://www.coursehero.com/file/22234999/Hozho-A-1/

Are dividends a percentage of EBT? or what value should i be using to calculate dividends as a percentage from? And does Hozho pay the royalties and license fees under other costs? and does the foreign-source income only apply to Din?

Hozho (US) Revenues: External sales Internal sales Cost of goods sold (COGS): Purchase from Hozho Freight charges for imported rugs Imported duties on imported rugs Local labor Local materials Other variable costs Hozhos finishing costs Total COGS Other costs: Royalties and license fees General & administratvie expensees Distributed charges due Hozho Depreciation Total other costs EBIT Interest expenses interest on local debt Interest on parent-provided debt EBT Corporate income tax on domestic income Taxes due on foreign-source active income Taxes due on foreign-source passive income Total taxes due Foreign-source income (net of withholding taxes) Dividends received from Din Royalties received from Din Distributed charges received from Din Interest earnings from Din Total net foreign-source income Total income (domestic + foreign) Retained earnings Distributed earnings $480,000.00 $612,000.00 $312,500.00 $187,500.00 $125,000.00 $40,000.00 $665,000.00 $21,840.00 $35,000.00 $9,600.00 $15,000.00 $81,440.00 $345,560.00 $345,560.00 $117,490.40 $117,490.40 Din (UK) $1,096,500.00 $612,000.00 $17,000.00 $106,930.00 $34,000.00 $34,000.00 $25,500.00 $829,430.00 $25,000.00 $8,500.00 $33,500.00 $233,570.00 $24,000.00 $209,570.00 $0.00 $0.40 Active Income (dividend repatriation) Dividend remittance: Dividends paid by Din (UK) Less witholding taxes Net dividend remitted to Hozho (US) Gross up of dividend remitted for US tax purposes: Net dividend remitted to Hozho (US) Add back foreign taxes paid Witholding taxes on dividends UK corporate income taxrs paid on distributions Grossed-up dividend income Theoretical US taxes due Credit for foreign taxes paid Additional US taxes due? Excess foreign tax credits? Passive Income (royalties, interest, distributed charges) Passive income remittance Royalties paid by Din (UK) to Hozho (US) Less witholding taxes paid Net royalties remitted to Hozho (US) Interest paid by Din (UK) to Hozho (US) Less witholding taxes paid Net interest remitted to Hozho (US) Gross up of passive income remitted for US tax purposes: Total passive income remitted (royalties, interest, charges) Total foreign tax credits Grossed-up foreign source passive income Theoretical US taxes due Credit for foreign taxes paid Additional US taxes due Excess foreign tax credits