Albany, Inc. does business in states C and D. State D uses an apportionment formula that double-weights the sales factor; state C apportions income using an equally-weighted three-factor formula. Albany's before tax income is $3,000,000, and its sales, payroll, and property factors are as follows.
Calculate Albany's income taxable in each state.

Question

Quizplus · Accepted Answer

C taxable income = $3 million × (50% + 40% + 20%)/3; D taxable income = $3,000,000 × (50% × 2 + 60% + 80%)/4.
 $$\begin{array} { l c c c c } 
& \text { C } & & \text { D } & \
\text { Sales factor } & 50 & \% & 50 & \% \
\text { Payroll factor } & 40 & \% & 60 & \% \
\text { Property factor } & 20 & \% & 80 & \%
\end{array}$$