Chipper Corporation realized $1,000,000 taxable income from the sales of its products in States X and Z.Chipper's activities establish nexus for income tax purposes only in Z,the state of its incorporation.Chipper's sales,payroll,and property among the states include the following.

X utilizes a sales-only factor in its three-factor apportionment formula.How much of Chipper's taxable income is apportioned to X?

Question

Chipper Corporation realized $1,000,000 taxable income from the sales of its products in States X and Z.Chipper's activities establish nexus for income tax purposes only in Z,the state of its incorporation.Chipper's sales,payroll,and property among the states include the following.
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X utilizes a sales-only factor in its three-factor apportionment formula.How much of Chipper's taxable income is apportioned to X?

Quizplus · Accepted Answer

Chipper Corporation only has nexus in State Z, and State X only uses a sales-only factor in its apportionment formula, meaning that only sales made in State X would be included in the apportionment calculation. Since there were no sales made in State X, none of Chipper's taxable income would be apportioned to State X, resulting in an apportionment of $0.

Chipper Corporation Realized $1,000,000 Taxable Income from the Sales of Its