Helene 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. Helene'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.
Helene's apportionable income assigned to A is:

Question

Helene 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. Helene'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.
 Helene's apportionable income assigned to A is:

Quizplus · Accepted Answer

To calculate the apportionable income assigned to State A, we need to use the three-factor apportionment formula where the sales, property, and payroll factors are equally weighted.

Sales factor = ($300,000 + $400,000 + $400,000) / $1,600,000 = 0.75
Property factor = ($100,000 + $200,000 + $400,000) / 3 = $233,333
Payroll factor = ($100,000 + $200,000 + $100,000) / 3 = $133,333

Apportionment fraction = (0.75 + $233,333 + $133,333) / 3 = 0.42778

Apportionable income assigned to State A = $1,000,000 x 0.42778 = $311,100

Therefore, the correct answer is C) $311,100.

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