LO.3 LearCo, a non-U.S. conglomerate, generates $4,000,000,000 in gross receipts annually. Its U.S. subsidiary, KingCo, accounts for $750,000,000 of the annual gross receipts; KingCo's average annual gross receipts for the last three years is $820,000,000. KingCo generates U.S. taxable income of $180,000,000 after deduct- ing a $350,000,000 management fee that it pays to LearCo. KingCo reports no U.S. tax credits. The corporate income tax rate in LearCo's country is 14%. What are the tax implications (if any) of this arrangement