Corolla Corporation owns manufacturing facilities in States A,B,and C.A uses a three-factor apportionment formula under which the sales,property and payroll factors are equally weighted.B uses a three-factor apportionment formula under which sales are double-weighted.C employs a single-factor apportionment factor,based solely on sales.
Corolla's operations generated $1,000,000 of apportionable income,and its sales and payroll activity and average property owned in each of the three states is as follows.

Corolla's apportionable income assigned to B is:

Question

Corolla Corporation owns manufacturing facilities in States A,B,and C.A uses a three-factor apportionment formula under which the sales,property and payroll factors are equally weighted.B uses a three-factor apportionment formula under which sales are double-weighted.C employs a single-factor apportionment factor,based solely on sales.
Corolla's operations generated $1,000,000 of apportionable income,and its sales and payroll activity and average property owned in each of the three states is as follows.

Corolla's apportionable income assigned to B is:

Quizplus · Accepted Answer

To calculate the apportionable income for State B, we need to use the three-factor apportionment formula in which the sales factor is double-weighted.

Sales factor for State B = ($400,000 ÷ $1,400,000) × 2 = 0.57
Property factor for State B = ($300,000 ÷ $1,200,000) = 0.25
Payroll factor for State B = ($700,000 ÷ $3,500,000) = 0.2

Weighted factors for State B:
Sales factor = 0.57 × 2 = 1.14
Property factor = 0.25
Payroll factor = 0.2

Total weighted factor for State B = 1.14 + 0.25 + 0.2 = 1.59

Apportionable income for State B = ($1,000,000 x 1.59) ÷ 3 = $528,666.67

Therefore, the closest answer is D) $458,300.

Corolla Corporation Owns Manufacturing Facilities in States A,B,and C