Kurt Corporation realized $900,000 taxable income from the sales of its products in States X and Z.Kurt's activities establish nexus for income tax purposes in both states.Kurt's sales,payroll,and property among the states include the following. Z utilizes an equally weighted three-factor apportionment formula.Kurt is incorporated in X.How much of Kurt's taxable income is apportioned to Z?

Question

Kurt Corporation realized $900,000 taxable income from the sales of its products in States X and Z.Kurt's activities establish nexus for income tax purposes in both states.Kurt's sales,payroll,and property among the states include the following.  Z utilizes an equally weighted three-factor apportionment formula.Kurt is incorporated in X.How much of Kurt's taxable income is apportioned to Z?

Quizplus · Accepted Answer

Since Kurt Corporation has established nexus for tax purposes in both states, the company's taxable income must be apportioned between the two. State Z uses an equally weighted three-factor apportionment formula, which takes into account sales, payroll, and property. Kurt Corporation's sales, payroll, and property in State Z are all zero, meaning that none of its taxable income is apportioned to State Z. Therefore, the answer is B, $150,000, which represents the portion of Kurt Corporation's taxable income that is apportioned to State X.

Kurt Corporation Realized $900,000 Taxable Income from the Sales of Its