Question
Triton, Inc., a California Corporation, has subsidiaries located in China and Zimbabwe. Earnings before taxes for China and Zimbabwe are $3,000,000 and $3,500,000, respectively. Corporate
Triton, Inc., a California Corporation, has subsidiaries located in China and Zimbabwe. Earnings before taxes for China and Zimbabwe are $3,000,000 and $3,500,000, respectively. Corporate Income Tax Rate for China and Zimbabwe are 40% and 26%, respectively. The US corporate income tax rate is set at 35%, and its dividend withholding tax rate is 0%. The dividend withholding tax rate for China and Zimbabwe are 10% and 5%, respectively.
Question: How much in additional U.S. taxes would be due if Triton averaged the tax credits and liabilities of the two foreign units, assuming a 50% payout rate from each?
Additional Information: calculated tax credits and liabilities (taxes due) for each country and average them.
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