Global Corporation, a U Global Paid $25,000 Income Tax to Country X

question 37

Multiple Choice

Global Corporation, a U.S. multinational, began operations this year. Global had pretax U.S. source income and foreign source income as follows. $$\begin{array} { l r } \text { U.S. source income } & \$ 700,000 \\\text { Foreign source income--Country X } & \underline { 100,000 } \\\text { Total } & \$ 800,000\end{array}$$ Global paid $25,000 income tax to Country X. What is Global's U.S. tax liability if it takes the foreign tax credit?

• A) $247,000
• B) $238,000
• C) $222,000
• D) $272,000

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Definitions:

Bond Liability

The amount owed by an entity to bondholders, including the principal and any unpaid interest.

Par

The nominal or face value of a bond, share, or other financial instrument, typically the value at which it is issued.

Bond Interest

The amount of interest paid by bond issuers to bondholders, typically expressed as an annual percentage of the bond's face value.

Interest Payment Date

The specific dates on which interest payments on a bond or loan are made to bondholders or lenders.