Tri-State's, Inc. operates in Arkansas, Oklahoma, and Kansas. Assume that each state has adopted the UDITPA formula. During the corporation's tax year ended December 31, the apportionment data indicated: Arkansas
Oklahoma
Kansas
Total
Gross receipts/sales
$175,000
$225,000
$100,000
$500,000
Payroll
20,000
140,000
20,000
180,000
Property
50,000
600,000
50,000
700,000
Tri-State's income for the current year is $250,000. Approximately how much income will be taxed by Oklahoma?

Question

Quizplus · Accepted Answer

Oklahoma's apportionment is calculated using the UDITPA formula: (Sales factor + Payroll factor + Property factor) / 3. For Oklahoma: Sales factor = 225,000/500,000, Payroll factor = 140,000/180,000, Property factor = 600,000/700,000. The average of these factors is multiplied by the total income of $250,000 to determine the income taxed by Oklahoma.