Instruction 21.1: Use the Information to Answer Following Question(s)

Instruction 21.1:
Use the information to answer following question(s) .
Rogue River Exporters USA has $100,000 of before tax foreign income. The host country has a corporate income tax rate of 25% and the U.S. has a corporate income tax rate of 35%.
-Refer to Instruction 21.1. If the U.S. treated the taxes paid on income earned in the host country as a tax-deductible expense, then Rogue River's total U.S. corporate tax on the foreign earnings would be ________.

A) $10,000
B) $26,250
C) $35,000
D) $51,250

Correct Answer:

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