HW Score: 33.33%, 1 of 3 pts Problem 15-2 (algorithmic) Question Help Pacific Jewel Airlines (Hong Kong). Pacific Jewel Airlines is a US-based air freight firm with a wholly owned subsidiary in Hong Kong. The subsidiary, Jewel Hong Kong, has just completed a long-term planning report for the parent company in San Francisco, in which it has estimated the following expected earnings and payout rates for the years 2011-2014 The current Hong Kong corporate tax rate on this category of income is 18%. Hong Kong imposes no withholding taxes on dividends remitted to US investors (per the Hong Kong United States bilateral tax treaty). The U.S. corporate income tax rate is 36%. The parent company wants to repatriate 80% of net income as dividends annually a. Calculate the net income available for distribution by the Hong Kong subsidiary for the years 2011-2014 b. What is the expected amount of the dividend to be remitted to the U.S. parent each year? After estimating the theoretical U.S. tax liability on the expected dividend (what is often termed gross-up in the U.S.), what is the total dividend after tax, including af Hong Kong and U.S. taxes, expected each year? d. What is the effective tax rate on this foreign-sourced income per year? a. Calculate the net income available for distribution by the Hong Kong subsidiary for the years 2011-2014 in the following table. (Round to the nearest dolar) 2011 2012 2013 2014 $ Jewel Hong Kong Income Items (millions USS) Earnings before interest and taxes (EBIT) Less interest expenses Earnings before taxes (EBT) Less Hong Kong corporate income taxes Net income 6.000 $ (600) 5,400 S 8,000 $ (800) 7,200 $ 10.000 $ (1.000) 9,000 S 12,000 (1,200) 10,800 $ $ Enter any number in the edit fields and then click Check Answer 3 parts remaining Clear All Check Answer 22 tv W A Savi Homework: Chapter 15 Homework Score: 0 of 1 pt 2 of 3 (1 complete) HW Score: 33.33%, 1 of 3 p Problem 15-2 (algorithmic) Question Help Pacific Jewel Airlines (Hong Kong). Pacific Jewel Airlines is a U.S.-based air freight firm with a wholly owned subsidiary in Hong Kong. The subsidiary, Jewel Hong Kong, has just completed a long-term planning report for the parent company in San Francisco, in which it has estimated the following expected earnings and payout rates for the years 2011-2014 The current Hong Kong corporate tax rate on this category of income is 18%. Hong Kong imposes no withholding taxes on dividends remitted to U.S. investors (per the Hong Kong United States bilateral tax treaty). The U.S. corporate Income tax rate is 36%. The parent company wants to repatriate 80% of net income as dividends annually a. Calculate the net i b. What is the expect Data Table c. After estimating the ter tax, including all Hong Kong and U.S. d. What is the effect a. Calculate the natin 2011 2012 2014 areut dollar) $ Jewel Hong Kong Income Items (millions USS). Earnings before interest and taxes (EBIT) Less interest axpenses Earnings before taxes (EBT) 6.000 $ (600) 8,000 S (800) 7,200 $ 2013 10,000 $ (1,000) 9,000 $ 12.000 (1.200) ator $ 5,400 $ 10.800 Jewel Hong Earnings before Less interested Earnings before Less Hong Kong Not income Print Dong Enter any number in the edit fields and then click Check Answer parts 3 remaining Clear All Check Answer 22 stv
