Sante Fe Corporation's sales office and manufacturing plant are located in State A. Sante Fe also maintains a manufacturing plant and sales office in State B. For purposes of apportionment, State A defines payroll as all compensation paid to employees, including contributions to § 401(k) deferred compensation plans.

Under the statutes of State B, neither compensation paid to officers nor contributions to § 401(k) plans are included in the payroll factor. Sante Fe incurred the following personnel costs.

What is the payroll factor for:

a. State A?

b. State B?

State A State B Total Wages and salaries for employees other than officers 60,000 $40,000 $100,000 Salaries for officers Contributions to S 401(k) plans Tota 40,000 20,000 $120,000 20,000 10,000 70,000 $190,000 60,000 30,000