Aqua, a South Carolina corporation, is a 20 percent partner in a Swiss partnership. This year, Aqua earned $2 million U.S. source income and $190,000 foreign source income. It paid no foreign income tax. The Swiss partnership earned $1.73 million foreign source income and paid $460,000 income tax to Switzerland, France, and Austria. Required: Compute Aqua's U.S. tax, assuming the foreign source income does not qualify as FDII.
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- Akita is a U.S. corporation. This year, it earned $7.80 million before-tax income and paid $436,800 income tax to jurisdictions other than the United States: Required: a. Compute Akita's U.S. income tax assuming that the other jurisdictions were the states of Montana, Colorado, California, and Arizona. b. Compute Akita's U.S. income tax assuming that the other jurisdictions were Italy and Spain, and Akita's foreign tax credit was not limited. Complete this question by entering your answers in the tabs below. Required A Required B Answer is complete but not entirely correct. Compute Akita's U.S. income tax assuming that the other jurisdictions were the states of Montana, Colorado, California, and Arizona. Note: Consider your intermediate values in dollars and not in millions. Enter your answer also in dollars and not in millions of dollars. U.S. income tax $ 1,201,200 < Required A Required B Show less AMany Mountains, Incorporated is a U.S. multinational corporation. This year, it had the following income. U.S. source income Foreign source income: Country X Country Y Total Multiple Choice O Many Mountains paid $15,000 income tax to Country X and $28,500 income tax to Country Y. Assume Many Mountains' foreign source income does not qualify as foreign- derived intangible income. Compute Many Mountains' allowable foreign tax credit. $15,000 $18.500 $33.500 $ 65,000 105,000 $35,700 $ 580,000 170,000 $750,000Elmo, Incorporated is a U.S. corporation with a branch office in foreign country Z. During the current year, Elmo had $392,000 of U.S. source income and $34,500 of foreign source income from Z, on which Elmo paid $16,100 of country Z income tax. Required: a. Calculate Elmo's U.S. tax liability before foreign tax credit, maximum foreign tax credit allowable, and net U.S. tax liability after foreign tax credit. b. If Elmo had paid only $3,795 of country Z income tax, calculate Elmo's foreign tax credit allowable and net U.S. tax liability after foreign tax credit. Complete this question by entering your answers in the tabs below. Required A Required B Calculate Elmo's U.S. tax liability before foreign tax credit, maximum foreign tax credit allowable, and net U.S. tax liability after foreign tax credit. Note: Do not round any intermediate division. U.S. tax liability before foreign tax credit Maximum foreign tax credit allowable Net U.S. tax liability after foreign tax credit Amount $…
- Elmo, Incorporated is a U.S. corporation with a branch office in foreign country Z. During the current year, Elmo had $340,000 of U.S. source income and $60,000 of foreign source income from Z, on which Elmo paid $28,000 of country Z income tax. Required: a. Calculate Elmo's U.S. tax liability before foreign tax credit, maximum foreign tax credit allowable, and net U.S. tax liability after foreign tax credit. b. If Elmo had paid only $10,000 of country Z income tax, calculate Elmo's foreign tax credit allowable and net U.S. tax liability after foreign tax credit. Complete this question by entering your answers in the tabs below. Required A Required B > Answer is complete but not entirely correct. Calculate Elmo's U.S. tax liability before foreign tax credit, maximum foreign tax credit allowable, and net U.S. tax liability after foreign tax credit. Note: Do not round any intermediate calculations. U.S. tax liability before foreign tax credit Maximum foreign tax credit allowable Net U.S.…Elmo, Incorporated is a U.S. corporation with a branch office in foreign country Z. During the current year, Elmo had $340,000 of U.S. source income and $60,000 of foreign source income from Z, on which Elmo paid $28,000 of country Z income tax. Required: a. Calculate Elmo's U.S. tax liability before foreign tax credit, maximum foreign tax credit allowable, and net U.S. tax liability after foreign tax credit. b. If Elmo had paid only $10,000 of country Z income tax, calculate Elmo's foreign tax credit allowable and net U.S. tax liability after foreign tax credit. Complete this question by entering your answers in the tabs below. Required A Required B Calculate Elmo's U.S. tax liability before foreign tax credit, maximum foreign tax credit allowable, and net U.S. tax liability after foreign tax credit. Note: Do not round any intermediate calculations. U.S. tax liability before foreign tax credit Maximum foreign tax credit allowable Net U.S. tax liability after foreign tax credit AmountJenna paid foreign income tax of $3,194 on foreign income of $15,968. Her worldwide taxable income was $125,000, and her U.S. tax liability was $31,000. Required: What is the amount of the foreign tax credit (FTC) allowed? What would be the allowed FTC if Jenna had paid foreign income tax of $6,400 instead?
- Business entity taxes for companies in the US. Jacob and Johny form and LLC that is treated as a partnership for federal income tax purposes. Jacob contributes property with a tax basis of $400 and fair market value of $500. In return Jacob receives a 40% ownership interest in the LLC. Johny contributes property with a tax basis of $1,100 and fair market value of $1,300. In return Johny receives a 60% ownership interest in the LLC. a. How much gain or loss does Jacob realize? b. How much gain or loss does Jacob recognize? c. What is Jacob’s initial outside basis? d. What is the partnership’s tax basis (inside basis) in the property contributed by Jacob? e. What is Brady’s initial outside basis?\ f. What is Brady’s initial book capital account balance?Waco Leather Incorporated, a U.S. corporation, reported total taxable income of $5.05 million. Taxable income included $1.85 million of foreign source taxable income from the company's branch operations in Mexico. All of the branch income is foreign branch income. Waco paid Mexican income taxes of $314,500 on its branch income. Compute Waco's allowable foreign tax credit. Note: Enter your answer in dollars and not in millions of dollars. Foreign tax creditDrake, Inc., a domestic corporation, has worldwide taxable income of $250,000, consisting of $200,000 U.S.-source income and $50,000 foreign-source dividend income from Jetco, a foreign corporation in which Drake owns 4% of the voting stock. The foreign tax paid on the dividend income is $20,000. a. What is the limit on the foreign tax credit? b. What is the US and total tax paid by Drake?