Tax creditsA U.S.-based MNC has a foreign subsidiary that earns

$ 252 comma 000$252,000

before local taxes, with all the after-tax funds to be available to the parent in the form of dividends. The applicable taxes consist of a

40 %40%

foreign income tax rate, a foreign dividend withholding tax rate of

9.5 %9.5%,

and a U.S. tax rate of

34 %34%.

Calculate the net funds available to the parent MNC if:

a.Foreign taxes can be applied as a credit against the MNC's U.S. tax liability.

b.No tax credits are allowed.