Use the Information to Answer the Following Question(s)

question 28

Multiple Choice

Use the information to answer the following question(s) .
Rogue River Exporters USA has $100,000 of before tax foreign income. The host country has a corporate income tax rate of 25% and the U.S. has a corporate income tax rate of 35%.
-Refer to Instruction 20.1. If the U.S. has a bilateral trade agreement with the host country that calls for the total tax paid to be equal to the maximum amount that could be paid in the highest taxing country, what is the total amount of income taxes Rogue River Exporters will pay to the host country, and how much will they pay in U.S income taxes on the foreign earned income?

• A)$25,000; $10,000
• B)$25,000; $26,250
• C)$35,000; $0
• D)none of the above

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Definitions:

Abbreviation

A shortened form of a word or phrase used to save space or avoid repetition in documents.

Pipe Series

A classification system for the dimensions, pressures, and temperatures of pipes and fittings used in plumbing and fluid transfer applications.

Fitments

Accessories or components that are designed to fit or be attached to a particular device, machine, or part of a building.

Orthographic

A method of projection in which a three-dimensional object is represented by several two-dimensional planes in technical drawing.