Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Oldham Incorporated conducts business in State M and State N, which both use the UDITPA three-factor formula to apportion income. State Ms corporate tax rate

Oldham Incorporated conducts business in State M and State N, which both use the UDITPA three-factor formula to apportion income. State Ms corporate tax rate is 4.50 percent, and State Ns corporate tax rate is 7.00 percent. This year, Oldham had the following sales, payroll, and property (in thousands of dollars) in each state:

State M State N Total
Gross receipts from sales $ 3,900 $ 8,400 $ 12,300
Payroll expense 1,700 2,100 3,800
Property costs 1,800 1,900 3,700

Required: If Oldhams before-tax income was $3.9 million, compute its State M and State N tax. (Round all apportionment factors to 4 decimal places, e.g., 47.15% would be 0.4715. Enter "Apportionment percentage" and "Tax rate" in decimals and not in percentage. Do not round any intermediate values. Enter your answers in dollars and not in millions or thousands of dollars.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting What The Numbers Mean

Authors: David Marshall, Wayne McManus, Daniel Viele

8th Edition

0073379417, 978-0073379418

More Books

Students also viewed these Accounting questions

Question

What proof is provided by a trial balance?

Answered: 1 week ago

Question

What forces are driving the added-value movement in HRM?

Answered: 1 week ago