Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

problem: Harpoon, is a United State multinational corporation that ships small appliances to its subsidiary in Austria. The marginal profits tax rate in the U.S. is 34%, and the marginal profits tax rate in Austria is 55%. The UNITED STATE taxes foreign subsidiary income only when repatriated, & permit a credit for foreign taxes paid. Austria has a 20% withholding tax on dividend payments, for which the United States gives a complete tax credit. Harpoon’s accountant has just informed you that she can justify setting a transfer price anywhere between $100 and $150 on microwave ovens shipped to Austria.

[A] Determine the transfer price?

[B] If Austria introduces an import tariff of 25% on microwave ovens, and permits this to be a deductible expense in figuring the subsidiary’s income tax, what should the transfer price be?

[C] If $100 in pretax profits is repatriated from Austria, how much cash does the parent receive? [Ignore import tariff introduced in problem B.]

[D] If $100 in pretax profits is repatriated from Austria, find out Harpoon’s additional tax burden or excess tax credit in the United States? [Ignore import tariff introduced in problem B]

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M921437

Have any Question? 


Related Questions in Basic Finance

A certain loop requires 5 loads 7 stores and 8 arithmetic

A certain loop requires 5 loads, 7 stores, and 8 arithmetic operations. What is the minimum initiation interval for a software pipelining of this loop on a machine that executes each operation in one clock tick, and has ...

1 describe the difference between a buyer taking title

1. Describe the difference between a buyer taking title subject to the mortgage versus assuming the mortgage. 2. Explain the difference between the equity right of redemption and the statutory right of redemption. 3. Exp ...

Question1which of the following is considered a major

Question 1.Which of the following is considered a major process flow structure? Lead Time Fabrication Lean Manufacturing Project 2. ISO audits result in certifications that are done by first, second, or third parties. Wh ...

Does the estimated maximum preload threaten your bolts you

Does the estimated maximum preload threaten your bolts? You guess, since this is a conventional or typical joint, that the joint to bolt stiffness ratio is 5:1. You believe that the tensile loads applied to this joint in ...

Fixed income securitiesdirections answer the following

Fixed Income Securities Directions: Answer the following questions and submit your answers to the Dropbox by midnight Sunday CT. Part I. Short Questions: please organize your answer so that it is short but to the point. ...

Researchers are interested in determining if men and womens

Researchers are interested in determining if men and women's hearts tend to be different sizes. In a sample of 12 males, the mean diameter of the heart was 13.21 cm with a standard deviation of 1.05. Among 9 females, the ...

Company x is currently considering a project that will

Company X is currently considering a project that will produce cash inflows of $9,000 a year for two years followed by $6,500 a year for three more years. The cost of the project is $25,000. What is the profitability ind ...

1 modify the eoq formula for the case where the holding

1. Modify the EOQ formula for the case where the holding cost is a concave function of the number of items kept in inventory. 2. Devise an optimal inventory policy for the EOQ model with a finite time horizon TH . 3. Dra ...

The us express reported that the color distribution for

The US Express reported that the color distribution for plain M&M's was: 40%brown, 20% yellow, 20% orange, 10% green, and 10% tan. Each piece of candy in a random sample of 100 plain M&M's was classified according to col ...

Stock pricing stock valuation bond pricesbullgo to

STOCK PRICING / STOCK VALUATION / BOND PRICES • Go to www.cnbc.com and explore the video tab by using several different key terms such as stock pricing, stock valuation, and bond prices. • Watch at least two videos you f ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen