Question 1

DC, a Delaware corporation, purchases goods manufactured in the United States by several related corporations and sells them in the United States and countries X and Y. The sales in country X are made through a branch of DC in country X, and the country Y sales are made by an unrelated country Y corporation functioning as DCs independent sales agent. For the current taxable year, DCs U.S. taxable income (determined without regard to foreign income taxes) is $1,000, of which $,100 is from the sales through the country X branch, $100 is from the sales to customers in country Y and $800 is from sales in the U.S. DCs U.S. tax before credit for foreign income taxes is $350. Its country X tax for the year is $40. It pays no country Y tax because it has no permanent establishment in that country. What is DCs U.S. tax after the foreign tax credit?