Determine the State tax liability for state X

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Question - Offenburg, Inc. does business in states X and Y. State X uses an equally-weighted three-factor apportionment formula and has a 4 percent state tax rate. State Y uses an apportionment formula that double-weights the sales factor and has a 6 percent tax rate. The company's taxable income, before apportionment, is $3 million. Its sales, payroll, and property information are as follows.

 

X

Y

Total

Gross receipts/sales

$575,000

100,000

675,000

Payroll

140,000

60,000

200,000

Property

600,000

150,000

750,000

Requirements - Determine the following:

(1) The company's apportionment factor to state X in percent (XX.X%).

(2) The company's apportionment factor to state Y in percent (XX.X%).

(3) State tax liability for state X.

(4) State tax liability for state Y.

Reference no: EM132568073

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