D Corporation Operates in Two States, Y and Z What Is D's State Z Taxable Income for the Current

question 4

Multiple Choice

D Corporation operates in two states, Y and Z.Both states impose a state income tax.For the current year, D has taxable income of $5,000,000 (after state adjustments) .Such income consists of $4,000,000 of business income and $1,000,000 of nonbusiness income attributable solely to State Y.D conducts sufficient activities in both states to create nexus.Both states allocate nonbusiness income and apportion business income using a three-factor formula.State Y equally weights the three factors, while State Z assigns double weight to the sales factor.The current year factors are as follows: $\begin{array}{lll}&\text { State } Y&\text { State } Z\\\text { Sales } & 80 \% & 20 \% \\\text { Property } & 40 \% & 60 \% \\\text { Payroll } & 60 \% & 40 \%\end{array}$ What is D's State Z taxable income for the current year.

• A)$1,866,666
• B)$1,400,000
• C)$1,750,000
• D)$2,400,000
• E)$1,600,000

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Heat

A form of energy associated with the movement of atoms and molecules in any material.

Evaporation

Transition of a liquid to a vapor.

Coelomic Fluid

Fluid found within the coelom, the body cavity of most animals, which aids in the transport of gases, nutrients, and waste materials.

Nephridia

Excretory organs in many invertebrates, including annelids, that serve to remove metabolic wastes from an organism’s body.