Question

Wayne Corporation is subject to State A’s franchise tax. The tax is imposed at a rate of 1.2% of the corporation’s net worth that is apportioned to the state by use of a two-factor formula (sales and property factors, equally weighted). The property factor includes real and tangible personal property, valued at historical cost as of the end of the taxable year.
Forty percent of Wayne’s sales are attributable to A, and $600,000 of the cost of Wayne’s tangible personal property is located in A.
Determine the A franchise tax payable by Wayne this year, given the following end-of-the-year balance sheet.


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  • CreatedSeptember 09, 2015
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