14-24 Computation of Apportionment Percentages. Q Corporation conducts a multistate business that operates in States A...

 

 

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14-24 Computation of Apportionment Percentages. Q Corporation conducts a multistate business that operates in States A and B. For the current taxable year, Q generated $3,000,000 of taxable income, consisting of $2,800,000 of business income and $200,000 of nonbusiness income from investments. P manages the investments in State A, which is also its state of commercial domicile. Both states allocate nonbusi- ness income and apportion business income using a three-factor formula in which sales, property (based on average historical cost), and payroll are equally weighted. Neither state takes leased property into account in computing its property factor. Selected information for the current year is as follows: Sales Property (average cost) Average accumulated depreciation Rent expense (annual). Payroll.. State A State B Total $8,000,000 $2,000,000 $10,000,000 $5,000,000 $1,000,000 $6,000,000 $1,000,000 $ 500,000 $ 1,500,000 $ 25,000 $ 10,000 $ 35,000 $2,000,000 $ 500,000 $2,500,000 Determine the current year apportionment percentages for States A and B. 14-24 Computation of Apportionment Percentages. Q Corporation conducts a multistate business that operates in States A and B. For the current taxable year, Q generated $3,000,000 of taxable income, consisting of $2,800,000 of business income and $200,000 of nonbusiness income from investments. P manages the investments in State A, which is also its state of commercial domicile. Both states allocate nonbusi- ness income and apportion business income using a three-factor formula in which sales, property (based on average historical cost), and payroll are equally weighted. Neither state takes leased property into account in computing its property factor. Selected information for the current year is as follows: Sales Property (average cost) Average accumulated depreciation Rent expense (annual). Payroll.. State A State B Total $8,000,000 $2,000,000 $10,000,000 $5,000,000 $1,000,000 $6,000,000 $1,000,000 $ 500,000 $ 1,500,000 $ 25,000 $ 10,000 $ 35,000 $2,000,000 $ 500,000 $2,500,000 Determine the current year apportionment percentages for States A and B.

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