Question

Balboa Corporation activities for the year are summarized below:

Addition modifications $29,000
Allocated income (total) 25,000
Allocated income (State F) 3,000
Allocated income (State G) 22,000
Apportionment percentage 40%
Credits 800
Federal taxable income 90,000
Subtraction modifications 15,000
Tax rate 5%

Compute Balboa Corporation's State F taxable income and net tax liability for the year.

Answer 1

Balboa Corporation's State F taxable income and net tax liability for the year is $930

Step-by-step explanation:

Balboa Corporation’s State F taxable income for the year

Federal taxable income $90,000

Addition modifications $29,000

Subtraction modifications -$15,000

Net Federal Taxable Income $104,000

Allocated income (total) -$25,000

State Taxable Income $79,000

Apportionment percentage 40%

$31,600

Allocated income (State F) $3,000

Income Allocated to State F $34,600

Tax rate 5%

$1,730

Less: Tax Credits -$800

State F taxable income for the year $930