Tax Drill - Allocation of Deductions

Khan, Inc. a domestic corporation, reports $650,000 of gross income and an $80,000 expense, all related to real estate activities.

Determine the expense allocation and apportionment using gross income as a basis.

When required, round any division to three decimal places. Use rounded amounts in subsequent computations.

	Foreign Gross Income	U.S. Gross Income	Allocation	Apportionment Foreign	Apportionment U.S.
Sales income	$500,000	$85,000	$72,000	$	$
Rental Income	50,000	15,000	$8,000	$	$
	$550,000	$100,000	$80,000	$	$