Question: Walrus Co Mining, a U.S.-based MNC has a foreign subsidiary that earns $1,050,000 before local taxes, with all the after tax funds to be available
Walrus Co Mining, a U.S.-based MNC has a foreign subsidiary that earns $1,050,000 before local taxes, with all the after tax funds to be available to the parent in the form of dividends. The foreign income tax rate is 30%, the foreign dividend withholding tax rate is 15%, and the firm's U.S. tax rate is 35%. What are the funds available to the parent MNC if foreign taxes can be applied as a credit against the MNC's U.S. tax liability?
A) $624,750
B) $425,250
C) $257,250
D) $735,000
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