What are us tax consequences of the branch activities

Assignment Help Financial Accounting

Reference no: EM13131258

Beatco, an accrual basis domestic corporation, manufactures musical instruments for sale both in the United States and abroad. Beatco’s functional currency is the U.S. dollar. Two years ago, Beatco established a branch sales office in Switzerland. The sales office qualifies as a qualified business unit with the Swiss franc (SF) as its functional currency. The branch’s tax attributes for its first two years of operations are as follows: Year 1 Year 2

Taxable income SF40 million None
Foreign income taxes (paid at end of year) SF15 million None
Remittance to Beatco (paid at end of year) None SF25 million

The Swiss franc had an average daily value of $0.50 during Year 1, $0.65 during Year 2, and was worth $0.60 at the end of Year 1, and $0.75 at the end of Year 2.

What are the U.S. tax consequences of the branch’s activities in Year 1and Year 2?

Reference no: EM13131258

Questions Cloud

Computing unlevered cost of capital : The Green Paddle has a cost of equity of 13.73 percent and a pre-tax cost of debt of 7.6 percent. the debt-equity ratio is 0.65 and the tax rate is 32 percent. What is green paddle's unlevered cost of capital?

Determine lottery-s expected profit per ticket : 2 prizes of $1250, and 1 prize of 3000. Assume that 22,000 lottery tickets are issues and sold for $1. What is the lottery's expected profit per ticket?

Is there a significant difference in mean hdl levels : Is there a significant difference in mean HDL levels among the exercise groups? Run the test at a 5% level of significance.

What is the expected freezing point : What is the expected freezing point of an aqueous solution of 2.62 kg of nitric acid, HNO3 , in a solution with a total mass of 5.91 kg? Assume that the nitric acid is completely ionized.

What are us tax consequences of the branch activities : The Swiss franc had an average daily value of $0.50 during Year 1, $0.65 during Year 2, and was worth $0.60 at the end of Year 1, and $0.75 at the end of Year 2. What are US tax consequences of the branch’s activities in Year 1and Year 2?

Correction : Proof read and improve. If there is a correction please change it.

Analyze the process of accounting for changes in ownership : Determine how a company you researched would approach the change in ownership interest under current GAAP and how that approach would differ under proposed GAAP. Provide specific examples to support your response.

Retirement of bonds : Prepare journal entries to record the following retirement. (Show computations and round to the nearest dollar.) The December 31, 2010 balance sheet of Wolfe Co. included the following items:

Compute oh of each aqueous solution : Calculate OH- of each aqueous solution using the following H3o+ A baking soda 1.0 X 10-8M B orange juice 2.0 X 10-4

User Account

All Pages