The Bartonia Company manufactures grommets in Georgia and sell them directly to industrial customers in Georgia, Florida,

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The Bartonia Company manufactures grommets in Georgia and sell them directly to industrial customers in Georgia, Florida, and South Carolina. The company's profit for last year was $20,000,000. The company has its manufacturing plant and headquarters in Georgia, warehouses in South Carolina and Florida, and sales forces in each state. Here are some of its financial statistics:
Payroll Property Sales GA 5,000,000 35,000,000 6,000,000 SC 1,000,000 5,000,000 13,000,000 FL 500,000 400,000 1,000,000

1. Suppose each state uses a simple three-factor apportionment formula. What share of company profit would each state tax?
2. Make that same calculation, but suppose each state double-weights the sales factor.
3. Make the calculation with each using only the sales factor.
4. Assume now that GA adopts the single sales factor and the other states use double-weighted sales.
5. Assume now that South Carolina adopts the single sales factor and the other states use double-weighted sales.
6. Explain why manufacturing firms in some states have pressed for use of the single sales factor. Why have nationwide business organizations not made this switch an issue?
Please answer all parts.

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Accounting Principles Part 2

ISBN: 978-1118306796

6th Canadian edition Volume 1

Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Kinnear, Joan E. Barlow

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