Intec Corporation (a U.S.-based company) has a wholly owned subsidiary located in Shanghai, China, that generated income before tax of 500,000 Chinese renminbi (RMB) in the current year. The Chinese subsidiary paid Chinese income taxes at the rate of 25 percent evenly throughout the year, and paid dividends of RMB 200,000 to Intec on October 1. Assume there is no withholding tax on dividends. The following exchange rates for the current year apply:
USS per RMB 
January 1 
$0,125 
Average for the year 
0.120 
October 1 
0.118 
December 31 
0.115 
Required:
Determine the following related to the income earned by Intec's Chinese subsidiary:
a. The amount of U.S. taxable income in U.S. dollars.
b. The amount of foreign tax credit allowed in the United States.
c. The amount of net U.S. tax liability.