Question
HomeShop has a branch/local office in Japan. HomeShop sells 30000 units to customers in Bulgaria and 100000 units to customers in Japan. Profit per unit
HomeShop has a branch/local office in Japan. HomeShop sells 30000 units to customers in Bulgaria and 100000 units to customers in Japan. Profit per unit is 89 (Ignore all other costs). All profits are repatriated from Japan. The corporate tax rate in Bulgaria is 40% and 32% in Japan.
1. With no Tax relief agreement in Japan, what are the total taxes that HomeShop has to pay in both countries?
2. Now assume that there is a possibility to use foreign tax credit (FTC) in Bulgaria. What will be the total taxes HomeShop has to pay in this scenario in both countries?
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CISA Certified Information Systems Auditor Bundle
Authors: Peter H. Gregory
1st Edition
1260459861, 978-1260459869
