Yogi Ltd. of Varanasi, India exports "Product X" to YO Ltd of Tokyo, Japan an associated enterprise for 5, 300 per product. Yogi Ltd. also exports similar product to Y Ltd and OY Ltd, who are unrelated for 5, 350 and 5,550 respectively. What is the price considered to compute profits from transaction with YO Ltd?

Yogi Ltd. of Varanasi, India exports "Product X" to YO Ltd of Tokyo, Japan an associated enterprise for 5, 300 per product. Yogi Ltd. also exports similar product to Y Ltd and OY Ltd, who are unrelated for 5, 350 and 5,550 respectively. What is the price considered to compute profits from transaction with YO Ltd?

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter16: Multijurisdictional Taxation

Section: Chapter Questions

Problem 10P

See similar textbooks

Similar questions

A company manufactures a product in the United States and sells it in England. The unit cost of manufacturing is $52. The current exchange rate (dollars per pound) is 1.213. The demand function, which indicates how many units the company can sell in England as a function of price (in pounds) is of the power type, with constant 27556733 and exponent -2.5. A) Develop a model for the company's profit (in dollars) as a function of the price it charges (in pounds). Then use a data table to find the profit-maximizing price to the nearest pound. Assume that the price ranges from £45 to £100 in increments of £1. Round your answer for the maximum profit to the nearest dollar and your answer for the best price to the nearest pound. 1. Maximum profit: $______ 2. Best price: £ ______
A domestic manufacturing company made the following sales to various entities during the current period as follows:Gross sales to ABC Company, a resident domestic company, P600,000 Gross sales to DEF Company, an export-oriented domestic company, P700,000Gross sales to GHI Enterprises, a non-resident foreign company, US$15,000Gross sales to JKL Corporation, an export-oriented domestic company, P500,000Gross sales to MNO Company, a non-resident foreign company, US$13,000The exchange rate at the time of sale was US$1 = P40The export sale of DEF Company is 65% of its total annual production during the periodGHI Enterprises paid in foreign currency and the transaction was properly accounted in accordance with BSP rules and regulationsThe export sale of JKL Corp is 80% of its total annual production during the period.MNO Company paid in equivalent Philippine peso What amount is subject to 12% VAT and 0%? What is the amount of output VAT for the period?
Bidbid Company manufactures a product with a unit variable cost of OMR 95 and a unit sales price of OMR 220. Fixed manufacturing costs were OMR 480,000 when 10,000 units were produced and sold. The company can sell an additional 1,000 units at OMR 140 each in a foreign market which would not affect its present sales. If the company has sufficient capacity to produce the additional units, acceptance of the special order would affect net income as follows:
a) Mashimoto Electric is based in Osaka, Japan. Mashimoto Electric has a subsidiary inSingapore that generates SGD 50 million in annual sales. Any earnings generated by thesubsidiary are reinvested to support its operations. Benzai Electric is the close competitor ofMashimoto Electric. Benzai Electric is a local Japanese company located in Japan with 2 annual export sale to Singapore of about SGD 50 million. Based on the informationprovided, which firm is subject to a higher degree of translation exposure? Justify youranswer with thorough explanation on both companies.b) Diamond Limited, a New Zealand company has an Australian subsidiary that earnedAUD40 million this year. Little Limited, which is also resided in New Zealand has anAustralian subsidiary that earned AUD30 million this year. The subsidiary of DiamondLimited plans to reinvest its earnings in Australia while the subsidiary of Little Limitedplans to remit its earnings to the New Zealand parent. Another New Zealand…
Chinglish Dirk (A), Chinglish Dirk Company (Hong Kong) exports razor blades to its wholly owned parent company, Torrington Edge (Great Britain). Hong Kong tax rates are 18% and British tax rates are 33%. The markup was 15% and the sales volume was 2,500 units Chinglish calculates its profit per container as follows (all values in British pounds) Corporate management of Torrington Edge is considering repositioning profits within the multinational company What happens to the profits of Chinglish Dirk and Torrington Edge, and the consolidated results of both, if the markup at Chinglish was increased to 20% and the markup at Torrington was reduced to 10%? What is the impact of this repositioning on consolidated after-tax profit and total tax payments? Calculate the profits of Chinglish Dirk and Torrington Edge, and the consolidated results of both, if the markup at Chinglish was increased to 20% and the markup at Torrington was reduced to 10% in the following table: (Round to the nearest…
KS Inc. produces a product in the United Kingdom at a cost of £0.55 per unit which it then sells in France for €1.25 per unit. If in the currency markets, 1 U.S. dollar = £0.6373 and 1 U.S. dollar = €1.0279, how much profit is realized by KS Inc. on each unit of product sold? * $0.7857 $0.3531 $0.2571 $0.1095 When the supply for money increases and the demand for money reduces, there will be * A fall in the level of prices An increase in the rate of interest A fall in the level of demand A decrease in the rate of interest
Iberico plc, a Spanish firm whose functional currency is EUR, bought goods from a British supplier at a cost of 10,000 GBP paid in cash. The exchange rate on the date of sale was 1 GBP = 1.2 EUR. Which the journal entry shall Iberico plc prepare regarding the purchase? Select one: a. DR Inventories 12,000 EUR, CR Cash 10,000 GBP b. DR Inventories 12,000 EUR, CR Cash 12,000 EUR C. DR Inventories 12,000 GBP, CR Cash 12,000 GBP d. DR Inventories 10,000 GBP, CR Cash 10,000 GBP Clear my choice
ABC Inc. is a U.S. firm with annual export sales to Canada of about C$500 million. Its main competitor is XYZ Inc., also based in the United States, with a subsidiary in Canada that generates about C$500 million in annual sales. Any earnings generated by the subsidiary are reinvested to support its operations. Based on the information provided, which company is subject to a higher degree of translation exposure? Explain.
Suppose British pound = $1.60, Canadian dollar = $0.74, explain indirect rate, how many pounds must a British company pay to purchase goods costing $8,000 from a U.S. company?
Transfer Pricing; International Taxation Crain Company has a manufacturing subsidiary inSingapore that produces high-end exercise equipment for U.S. consumers. The manufacturing subsidiary has total manufacturing costs of $1,500,000, plus general and administrative expenses of$350,000. The manufacturing unit sells the equipment for $2,500,000 to the U.S. marketing subsidiary, which sells it to the final consumer for an aggregate of $3,500,000. The sales subsidiary hastotal marketing, general, and administrative costs of $200,000. Assume that Singapore has a corporate tax rate of 33% and that the U.S. tax rate is 46%. Assume that no tax treaties or other special taxtreatments apply.Required What is the effect on Crain Company’s total corporate-level taxes if the manufacturing subsidiary raises its price to the sales subsidiary by 20%?
Assume that your Saudi affiliate reports sales revenue of SR 211000. Translate this revenue figure to Omani Rial using the following spot rate. OMR 1 = SR 10.2
Harris Incorporated had the following transactions: On May 1, Harris purchased parts from a Japanese company for a U.S. dollar–equivalent value of $7,000 to be paid on June 20. The exchange rates were May 1 1 yen = $0.0070 June 20 1 yen = 0.0075 On July 1, Harris sold products to a Brazilian customer for a U.S. dollar equivalent of $10,400, to be received on August 10. Brazil’s local currency unit is the real. The exchange rates were July 1 1 real = $0.20 August 10 1 real = 0.22 Required: Assume that the two transactions are denominated in U.S. dollars. Prepare the entries required for the dates of the transactions and their settlement in U.S. dollars. Assume that the two transactions are denominated in the applicable LCUs of the foreign entities. Prepare the entries required for the dates of the transactions and their settlement in the LCUs of the Japanese company (yen) and the Brazilian customer (real).