International Accounting
5th Edition
ISBN: 9781259747984
Author: Doupnik, Timothy S., Finn, Mark T., Gotti, Giorgio
Publisher: Mcgraw-hill Education,
expand_more
expand_more
format_list_bulleted
Question
Chapter 9, Problem 9EP
To determine
Calculate the amount of penalty for underpayment of taxes.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Pursuant to the Foreign Account Tax Compliance Act, foreign financial institutions will have to report directly to the IRS certain information about financial accounts held by U.S. taxpayers, or by foreign entities in which U.S. taxpayers hold a substantial ownership interest. Proper compliance will require specific information intended to preclude U.S. taxpayer investors to utilize such investment vehicles to obtain potentially tax-exempt benefits intended for foreign taxpayers. Failure to properly comply will result in a 30% withholding tax with respect to payments flowing outside the U.S.
Group of answer choices
True
False
11. Due to the enactment of the CREATE Law, some provisions therein produced confusions on the part of the taxpayers. To clarify certain matters, the Commissioner of Internal Revenue may issue:
A. Revenue Regulations
B. Revenue Memorandum Order
C. Revenue Memorandum Circular
D. Revenue Rulings
12. The government, beginning January 2021, temporarily imposed what is called Safeguard Tax (SG Tax) on certain imported motor vehicles to minimize the influx of foreign-made vehicles to the detriment of local manufacturers. The purpose of the imposition of the SG Tax is based on
A. Primary purpose of taxation
B. Fiscal purpose
C. Regulatory purpose
D. Sumptuary purpose
13. Which of the following is not among the powers of the Commissioner?
I. Issue Revenue Regulations
II. Offer Voluntary Assessment and Payment Programs (VAPP) to taxpayers with delinquent accounts
for a specific year or period
III. Offer estate tax amnesty to taxpayers
IV. Require taxpayers to file Related Party Transaction…
The Tax Cut and Jobs Act of 2017 reduced the US corporate tax rate from a maximum
35% to a flat rate of 21%. As a result, companies were required to "revalue" their
deferred tax assets and liabilities to reflect the new tax rates. In general, a firm with a
substantial pool of US Federal NOL Carryforwards reported in the deferred tax asset
section (the DTA for NOLS) experienced a:
O No impact on deferred tax assets or liabilities because the cash tax value of an
NOL carryforward does not depend on the statutory tax rate
Reduction in the book value of the DTA for NOLS with the offset an increase in tax
expense
O Increase in market value reflecting the reduced value of the NOL tax shields
Increase the book value of the DTA for NOLS with the offset a decrease in tax
expense
Chapter 9 Solutions
International Accounting
Ch. 9 - Prob. 1QCh. 9 - Prob. 2QCh. 9 - 3. What is the performance evaluation objective of...Ch. 9 - 4. Why is there often a conflict between the...Ch. 9 - 5. How can transfer pricing be used to reduce the...Ch. 9 - Prob. 6QCh. 9 - 7. What is the arm’s-length range of transfer...Ch. 9 - Prob. 8QCh. 9 - 9. What is an advance pricing agreement?
Ch. 9 - 10. What are the costs and benefits associated...
Ch. 9 - Prob. 1EPCh. 9 - Prob. 2EPCh. 9 - Prob. 3EPCh. 9 - Prob. 4EPCh. 9 - 5. Which of the following is not a method commonly...Ch. 9 - Prob. 6EPCh. 9 - Prob. 7EPCh. 9 - Prob. 8EPCh. 9 - Prob. 9EPCh. 9 - Prob. 10EPCh. 9 - Prob. 11EPCh. 9 - Prob. 12EPCh. 9 - Prob. 13EPCh. 9 - 14. Superior Brakes Corporation manufactures truck...Ch. 9 - Prob. 15EPCh. 9 - Prob. 16EPCh. 9 - Prob. 18EPCh. 9 - Prob. 20EP
Knowledge Booster
Similar questions
- Please help thanksarrow_forward2arrow_forwardWhich statement is wrong? * A resident citizen and a resident alien have a final tax of 15% on interest on foreign currency deposit. A non-resident citizen is exempt from income tax on interest on foreign currency deposit. A non-resident alien engaged in business in the Philippines is subject to a final tax of 25% on gross income from within the Philippines from cinematographic films. A non-resident alien engaged in business in the Philippines has a final tax of 20% only if the interest is on a bank depositarrow_forward
- Which of the following is false regarding consumption and business tax? a. Importations of goods are subject to value-added tax whether the imported goods are to be used in business or not. b. All business taxes are consumption taxes but not all consumption taxes are business taxes. c. Business taxpayers with annual receipts higher than the VAT threshold who registered as VAT taxpayers may switch to a non-VAT registration provided such actual receipts during the year proved to be lower than the threshold. d. A business taxpayer subject to other percentage taxes shall register as a VAT taxpayer if its total sales or receipts exceeds the VAT threshold. e. All of the other choices is correct.arrow_forwardNew America, Inc., a USA exporter of computer hardware intends to open a retail subsidiary in Kabul, Afghanistan sometime during tax year 2019. New America’s chief accountant has contacted our firm to inquire about income taxation for this planned business in Afghanistan and about the income tax obligations they might incur if they followed through with their plan. They also have asked to compare the Afghanistan tax rates and the rules governing ordinary and necessary business deductions to the respective US tax provisions. What would be the tax memorandum for this question.arrow_forwardNew America, Inc., a USA exporter of computer hardware intends to open a retail subsidiary in Kabul, Afghanistan sometime during tax year 2019. New America’s chief accountant has contacted our firm to inquire about income taxation for this planned business in Afghanistan and about the income tax obligations they might incur if they followed through with their plan. They also have asked to compare the Afghanistan tax rates and the rules governing ordinary and necessary business deductions to the respective US tax provisions. set up the memorandum. Conduct appropriate research and cite all relevant primary authority (tax code, regulations, etc.).arrow_forward
- Transcom, an Ohio corporation, earned $700,000 U.S. source income from sales of goods to U.S. customers and $330,000 foreign source income from sales of goods to customers in Canada. Canada's corporate income tax rate is 15 percent, and the United States and Canada have a bilateral tax treaty. Required: a. Compute Transcom's U.S. tax if it does not maintain a permanent establishment in Canada. Assume the foreign source income does not qualify as FDII. b. Compute Transcom's U.S. tax if it does maintain a permanent establishment in Canada. Complete this question by entering your answers in the tabs below. Required A Required B Compute Transcom's U.S. tax if it does not maintain a permanent establishment in Canada. Assume the foreign source income does not qualify as FDII. U.S. income tax Required A Required B >arrow_forwardFlint Steel Corporation has a precredit U.S. tax of $188,000 on $518,000 of taxable income in 2016. Flint has $218,000 of foreign source taxable income and paid $98,000 of income taxes to the German government on this income. All of the foreign source income is treated as general category income for foreign tax credit purposes. Flint's foreign tax credit on its 2016 tax return will be: A. $98,000 B. $37,560 C. $79,120 D. $120,000arrow_forwardTarget’s Note 23 indicates that “We have not recorded deferred taxes when earningsfrom foreign operations are considered to be indefinitely invested outside the U.S.These accumulated net earnings relate to certain ongoing operations and were $685 million at January 30, 2016 and $328 million at January 31, 2015.” Are theseamounts treated as temporary or permanent differences by Target? If Target decidesto repatriate earnings in the future, what will be the effect on net income in the yearof the repatriation?arrow_forward
- Which of the following statements is incorrect? * A. If 5% special tax on gross income is granted to taxpayers, they are not required to remit compensation taxes of their employees.. B. If 5% special tax on gross income is granted to taxpayers, they are not required to pay business permits. C. If 5% special tax on gross income is granted to taxpayers, they are not required to pay value added tax. D. Resident foreign corporations may be exempted from paying income tax.arrow_forwardAssume that a foreign company using IFRS is owned by a company using U.S. GAAP. Thus, IFRS balances must be converted to U.S. GAAP to prepare consolidated financial statements. Ignore income taxes for given problem. Mikkeli OY acquired a brand name with an indefinite life in 2015 for 40,000 markkas. At December 31, 2017, the brand name could be sold for 35,000 markkas, with zero costs to sell. Expected cash flows from the continued use of the brand are 42,000 markkas, and the present value of this amount is 34,000 markkas.a. Determine the appropriate accounting for this brand name for the year ending December 31, 2017, under (1) IFRS and (2) U.S. GAAP. b. Prepare the entry(ies) that the U.S. parent would make on the December 31, 2017, conversion worksheet to convert IFRS balances to U.S. GAAP.arrow_forwardThe following information relates to Swans Ltd, a vendor, and a resident of the Republic, for its tax period (a two-month period) ended 31 December 2022: Supplies of goods made by it subject to value-added tax at the standard rate amounted to R345 000 (R300 000 plus value-added tax of R45 000). Supplies of goods or services made by it subject to value-added tax at the zero-rate amounted to R100 000 (R100 000 plus value-added tax of Rnil). These goods were exported. Supplies of goods or services made by it not subject to value-added tax (exempt) amounted to R30 000 (R30 000 plus value-added tax of Rnil). Input tax of R50 000 was incurred by it for capital goods purchased. Input tax incurred for goods and services supplied to it was R25 000. Second-hand goods (not of a capital nature) were purchased by it from a non-vendor for R23 000 and paid for in cash. A debtor who owed it R69 000 (R60 000 plus value-added tax of R9 000) was liquidated during this period. A first and final…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Individual Income TaxesAccountingISBN:9780357109731Author:HoffmanPublisher:CENGAGE LEARNING - CONSIGNMENT
Individual Income Taxes
Accounting
ISBN:9780357109731
Author:Hoffman
Publisher:CENGAGE LEARNING - CONSIGNMENT