Compute trikeco deemed paid foreign tax credit

Reference no: EM13138667

Trikeco, a domestic corporation, manufactures mountain bicycles for sale both in the United States and Europe. Trikeco operates in Europe through Trike1, a wholly owned Italian corporation that manufactures a special line of mountain bicycles for the European market. In addition, Trike1 owns 100% of Trike2, a U.K. corporation that markets Trike1's products in the United Kingdom. At end of the current year, the undistributed earnings and foreign income taxes of Trike1 and Trike2 are as follows:

Trike1 Trike 2
Post-1986 undistributed earnings $90 million $54 million
Post-1986 foreign income taxes $54 million $27 million

During the current year, Trike2 distributed a $10 million dividend to Trike1, and Trike1 distributed a $10 million dividend to Trikeco. To simplify the computations, assume that neither dividend distributions attracted any Italian or U.K. withholding taxes, and that the dividend received by Trike1 was exempt from Italian taxation.

Compute Trikeco's deemed paid foreign tax credit, as well as the residual U.S. tax, if any, on the dividend Trikeco received from Trike1. Assume the U.S. tax rate is 35%.

Reference no: EM13138667

Questions Cloud

Define the river estuary is tidal causing the surface : The river estuary is tidal causing the surface level of the water to rise and fall. At certain times of day, reflections from the water surface cause deep fading of the received signal.

Determine the phase relation between vo and ig : Determine the phase relation between V o and i g for the given network if V g = 45sin(317t) and determine v o for the given network

Compute unrecognized prior service cost amortization : Mancuso Corporation amended its pension plan on January 1, 2010, and granted $160,000 of unrecognized prior service costs to its employees. The employees are expected to provide 2,000 service years in the future, with 350 service years in 2010. Co..

Calculate the freezing point of a solution : Calculate the freezing point of a solution that contains 8.0 g of sucrose (C12H22O11) in 100. g of H2O. Kf for H2O = 1.86

Compute trikeco deemed paid foreign tax credit : Trikeco, a domestic corporation, manufactures mountain bicycles for sale both in the United States and Europe. Trikeco operates in Europe through Trike1, a wholly owned Italian corporation that manufactures a special line of mountain bicycles for ..

Should buyer purchasing authorize payment : Assume that a buyer receives a shipment of MODEL SD010 with an invoice amount of $780, although $870 worth of goods were received. The purchase order was for $870. Since the difference was in the buyer's favor, the buyer's purchasing department s..

Define the gain of the antennas must be increased : The gain of the antennas must be increased when the TDMA system described in part (d) is used because the bit rate is higher than with FDMA and the noise power in the receiver is therefore higher

Test the hypothesis that the mean is not pounds : Ask 20 men thier weight and use excel to calculate the mean. test the hypothesis that the mean is not 172 pounds at the .10 significance level.

What is the new volume of the balloon : When 0.549 moles of a certain gas fill a balloon the volume is 75 mL. If enough of the same gas is added to the balloon until 1.44 moles of gas are present, what is the new volume of the balloon?

User Account

All Pages