David,an Employee of Lima Corporation,is a U

question 159

Multiple Choice

David,an employee of Lima Corporation,is a U.S.citizen and the regional sales manager for South America.His office is in Miami and he spends nine months each year on business in South America.Which of the following statements about the treatment of his income from Lima Corporation is correct?

• A)He must include his Lima income in his gross income and is not allowed a tax credit for any South American taxes paid.
• B)He has the option of either excluding $97,600 of his Lima income or taking a tax credit for the South American taxes paid.
• C)Because he is in South America only nine months of the year, he is only allowed to exclude $68,625 of Lima income.
• D)Because he is in South America only nine months of the year, he is not allowed to exclude any of his Lima income, but he can take a tax credit for any South American taxes paid.

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Definitions:

Products

Goods or services offered by businesses to satisfy consumer needs or wants.

Regulatory Environment

The collection of laws, regulations, and rules that govern and influence the conduct of businesses and individuals within a society.

Consumer Protection

Measures and regulations to ensure the rights and safety of consumers are safeguarded.

Fair Competition

An economic condition in which businesses operate on a level playing field, with no unfair advantages, allowing for healthy competition in the market.