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23 May, 22:24

Ashton Corporation is headquartered in Pennsylvania and has a state income tax base there of $549,000. Of this amount, $77,000 was nonbusiness income. Ashton's Pennsylvania apportionment factor is 42.35 percent. The nonbusiness income allocated to Pennsylvania was $52,500 Assuming a Pennsylvania corporate tax rate of 8.25 percent, what is Ashton's Pennsylvania state tax liability? (Round your answer to the nearest whole dollar amount.)

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  1. 23 May, 22:36
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    State Tax liability = $20822

    Explanation:

    given data

    state income tax base = $549,000

    non business income = $77,000

    apportionment factor = 42.35 percent

    non business income = $52,500

    corporate tax rate = 8.25 percent

    to find out

    what is Ashton's Pennsylvania state tax liability

    solution

    we get here State Tax liability that is express as

    State Tax liability = [ { (tax base - non business income) * apportionment factor } + non business income] * tax rate ... 1

    put here value we get

    State Tax liability = [ { (tax base - non business income) * apportionment factor } + non business income] * tax rate

    State Tax liability = [ { (549,000 - 77,000) * 42.35% } + 52,500 ] * 8.25 %

    so State Tax liability = $20822
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