Boca Corporation,a U.S.corporation,reported U.S.taxable income of $1,000,000 in 2017.Included in the computation of taxable income was foreign source taxable income of $200,000,of which $87,500 was a dividend received from the corporation's 100 percent owned subsidiary in Ireland.The dividend brought with it a deemed paid credit of $12,500.In addition,a withholding tax of $4,375 was imposed on the dividend.Compute Boca Corporation's net U.S.tax liability for 2017.Assume a U.S.tax rate of 34 percent.

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Boca Corporation's U.S. tax liability before credits is $1,000,000 * 34% = $340,000. The foreign tax credit is the sum of the deemed paid credit ($12,500) and the withholding tax ($4,375), totaling $16,875. Therefore, the net U.S. tax liability is $340,000 - $16,875 = $323,125.