Luther Industries,a U

question 24

Essay

Luther Industries,a U.S.firm.has a subsidiary in the United Kingdom.This year,the subsidiary reported and repatriated earnings before interest and taxes (EBIT)of £45 million.The current exchange rate is $1.86/£.The tax rate in the U.K.for this activity is 28%.Under U.S.tax codes,Luther is facing a 35% corporate tax rate on their earnings.What is Luther's U.S.tax liability on its U.K.subsidiary?

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Definitions:

Visual Recognition

Visual recognition is the process by which the brain identifies and interprets what the eyes see, such as recognizing faces, objects, and symbols.

Stable Trait

A personality characteristic that remains consistent over time and across situations.

Left Hemisphere

The left side of the brain, which is typically associated with analytical thought, language, logic, and mathematical abilities.

Speaking Ability

The capacity to effectively express thoughts, feelings, and information through verbal language.