Reference no: EM132061126

COBALT CORP manufactures and sells peripheral computer equipment. It uses three wholly owned subsidiaries to sells its goods: COBALT CORP is the parent compay and is incorporated in State A; its only income this year relates to the rare sale of a foreign joint-venture interest. THE COBALT SHOP owns and operates retail stores in four states. COBALT ONLINE sells Cobalt products via its internet web site COBALT SALES makes wholesale sales of Cobalt products to third party wholesale dealers using employee sales reps COBALT and all three of its subsidiaries form a Unitary Group All of the Cobalt companies are based in State A. COBALT ONLINE and COBALT SALES use a warehouse in State A to ship goods to customers. COBALT ONLINE and COBALT SALES do not have income tax nexus in any state other than State A. Sales by state and by-company state taxable income for the tax year just ended were are follows: SALES State Taxable STATE A STATE B STATE C STATE D OTHER TOTAL Income COBALT CORP - - - - - - 1,000,000 COBALT SHOP 3,000,000 1,000,000 2,000,000 4,000,000 - 10,000,000 (500,000) COBALT ONLINE 2,000,000 1,000,000 5,000,000 3,000,000 9,000,000 20,000,000 5,000,000 COBALT SALES 1,000,000 3,000,000 2,000,000 1,000,000 3,000,000 10,000,000 3,000,000 TOTAL 6,000,000 5,000,000 9,000,000 8,000,000 12,000,000 40,000,000 8,500,000 a. Assume State A is a Unitary Combined state with a throwback rule, and uses a sales only factor for apportionment. Compute State A's Sales Factor, Taxable income, Apportioned taxable Income and income tax using a tax rate of 6% b. Assume State B is also a Unitary Combined State with a throwback rule, and uses a sales only factor for apportionment. Compute State B's Sales Factor, Taxable Income, Apportioned taxable income and income tax using a tax rate of 3% c. Assume State C is a separate filing state with no throwback and uses a sales only factor for apportionment. For each Sub required to file there, compute State C Sales Factor, Taxable income, Apportioned taxable income and income tax using a tax rate of 7%. Show your computations