Kim Corporation, a Calendar Year Taxpayer, Has Manufacturing Facilities in States

question 181

Essay

Kim Corporation, a calendar year taxpayer, has manufacturing facilities in States A and B. A summary of Kim's property holdings follows. Determine Kim's property factors for the two states. A's statutes provide that the average historical cost of business property is to be included in the property factor. B's statutes provide that the property factor is based on the average depreciated basis of in-state business property.

---

Definitions:

Par Value

A nominal value of a security or stock set by the issuing company, which may not reflect its market value.

Premium

An amount paid for an insurance policy or the amount by which a bond or stock sells above its face value.

Callable Bonds

Bonds that can be redeemed by the issuer before their maturity date at a predetermined call price.

Stated Dollar Amount

A specific monetary value declared or agreed upon, which is often used in financial contexts for contracts or transactions.