Indeco, a U.S. C corporation, operates Grange, a sales branch in Staccato. Indeco's U.S. corporate marginal tax rate is 35%; it is 20% for Staccato. Grange's pre-tax profit for the year is $1 million. There is no income tax treaty between the United States and Staccato. Staccato's currency is the U.S. dollar. Compute Indeco's combined U.S. and foreign income tax on the Grange profits, under each of the following assumptions.

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U.S Income Tax Staccato Income TaxTax Liability a. U.S. income tax law allows no deduction or b. U.S. income tax law allows only a deduction c. US. income tax law allows only an exclusion d. U.S. income tax law allows only a credit for e. US. income tax law allows only a credit for credit for foreign income taxes paid. for foreign income taxes paid. of foreign branch profits. the full amount of foreign income taxes paid. the full amount of foreign income taxes paid. The applicable Staccato tax rate is now 40%, f. U.S. income tax law allows only a credit for the full amount of foreign income taxes paid, but limited currently to the corresponding tax on his income at US. rates. The applicable Staccato tax rate is now 40%.