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Oldham, Incorporated conducts business in State M and State N, which both use the UDITPA...

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Accounting

Oldham, Incorporated conducts business in State M and State N, which both use the UDITPA three-factor formula to apportion income. State Ms corporate tax rate is 4.5 percent, and State Ns corporate tax rate is 7 percent. This year, Oldham had the following sales, payroll, and property (in thousands of dollars) in each state:

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Oldhams before-tax income was $4.50 million. Compute Oldhams State M and State N tax if State N uses an apportionment formula in which the sales factor is double-weighted.

GrossreceiptsfromsalesPayrollexpensePropertycostsStateM$3,5209501,080StateN$7,9602,0801,330Total$11,4803,0302,410

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