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KT Enterprises,a U.S.import-export trading company,is considering its international tax situation.KT's U.S.tax rate is 21%.KT has significant operations in both Japan and Ireland.In Japan the current exchange rate is ¥118.4/$ and earnings in Japan are taxed at 41%.In Ireland the current exchange rate is $1.27/€ and earnings in Ireland are taxed at 12.5%.KT's profits,which are fully and immediately repatriated,and foreign taxes paid for the current year are shown here (in millions):
-The amount of the taxes paid in dollars for the Japanese operations is closest to:

Question

Use the information for the question(s)below.
KT Enterprises,a U.S.import-export trading company,is considering its international tax situation.KT's U.S.tax rate is 21%.KT has significant operations in both Japan and Ireland.In Japan the current exchange rate is ¥118.4/$ and earnings in Japan are taxed at 41%.In Ireland the current exchange rate is $1.27/€ and earnings in Ireland are taxed at 12.5%.KT's profits,which are fully and immediately repatriated,and foreign taxes paid for the current year are shown here (in millions): 
-The amount of the taxes paid in dollars for the Japanese operations is closest to:

Quizplus · Accepted Answer

First, we calculate the pre-tax earnings for the Japanese operations by dividing the Japanese earnings (in yen) by the exchange rate:
280,000,000,000 / 118.4 = $2,364,864,865
Then, we calculate the Japanese taxes paid by multiplying the pre-tax earnings by the Japanese tax rate:
$2,364,864,865 x 0.41 = $968,750,001
Finally, we convert the taxes paid in yen to dollars by multiplying by the exchange rate:
$968,750,001 / 118.4 = $8,174,787
Therefore, the closest answer is D) $20.5 million.

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