If the Expansion Is Done Through a Branch Location in a Permanent

question 6

Multiple Choice

If the expansion is done through a branch location in a permanent establishment run by personnel from Saskatchewan, which of the following is incorrect?

• A)The profits belong to the Nova Scotia corporation.
• B)The Saskatchewan tax rate will apply.
• C)The branch profits for tax purposes may potentially be more than actually earned at the branch.
• D)The actual branch profits will be taxed as a separate entity.

---

Definitions:

Average Revenue

The revenue earned per unit of output sold; calculated by dividing the total revenue by the number of units sold.

Total Revenue

The total amount of money received by a firm from selling its goods or services.

Total Cost

The complete amount of money required for the production of a given level of output, including both fixed and variable costs.

Economic Profit

The difference between total revenue and total costs, including both explicit and implicit costs, representing the profits that exceed normal expected profits.