Employee X Drives a Company Automobile 6,000 Miles in State

question 10

Multiple Choice

Employee X drives a company automobile 6,000 miles in State A and 4,000 miles in State B.The automobile is valued at $20,000 for purposes of the property factor.The corporation's home office is located in State C.For purposes of the payroll factor, X's compensation is assigned to State B.The value of the automobile should be included in the numerator of the property factor as follows

• A)State A-$20,000
• B)State A-$12,000; State B-$8,000
• C)State B-$20,000
• D)State C-$20,000
• E)None of the above

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Definitions:

Salaries Expense

An account that records the total amount paid to employees for services performed during a specific period, excluding wages paid hourly.

Notes Payable

A formal written agreement to pay a specific amount of money on a certain date or upon demand to another party.

Salaries Expense

The total amount paid to employees for services rendered during a specific period, recorded as an expense on the income statement.

Supplies

Materials and items consumed or used in the operation of a business or manufacturing process that are not part of the final product.