Dott Corporation generated $300,000 of state taxable income from selling its mapping software in States A and B. For the taxable year, the corporation’s activities within the two states were as follows.

	State A	State B	Total
Sales	$500,000	$1,500,000	$2,000,000
Property	250,000	–0–	250,000
Payroll	200,000	300,000	500,000

Dott has determined that it is subject to tax in both A and B. Both states utilize a three-factor apportionment formula that equally weights sales, property, and payroll. The rates of corporate income tax imposed in States A and B are 7% and 10%, respectively. Determine Dott’s total state income tax liability.

Answer rating: 100% (QA)

State A State B Total taxable income subject to apportionment ... View the full answer