Pennworth Corporation operates in the United States and foreign country M. Its domestic subsidiary Delco, Inc. operates in foreign country N. This year, the two corporations report the following.

	U.S. Source Income			Foreign Source Income			Foreign Income Tax Paid
Pennworth	$	3,000,000		$	1,000,000		$	300,000
Delco		0			1,000,000			100,000

If Pennworth and Delco file a consolidated U.S. tax return, compute consolidated income tax liability.

Multiple Choice

• $650,000

• $1,050,000

• $630,000

• $1,450,000