Tax creditsA U.S.-based MNC has a foreign subsidiary that earns $251,000 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 37% foreign income tax rate, a foreign dividend withholding tax rate of 9.1%, and a U.S. tax rate of 30%.

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.

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Part 1

a.If foreign taxes can be applied as a credit against the MNC's U.S. tax liability, the net funds available to the U.S. company is

$enter your response here. (Round to the nearest dollar.)

Part 2

b.If no tax credits are permitted, the net funds available to the U.S. company is $enter your response here. (Round to the nearest dollar.)