The Burton Company manufactures chainsaws at its plant in Sandusky, Ohio. The company has marketing. 1 answer below »

The Burton Company manufactures chainsaws at its plant in Sandusky, Ohio. The company has marketing divisions throughout the world. A Burton marketing division in Lille, France, imports 200,000 chainsaws annually from the United States. The following information is available: U.S. income tax rate on the U.S. division s operating income ……………………….40% French income tax rate on the French division s operating income ………………….45% French import duty ……………………………………………………………………20% Variable manufacturing cost per chainsaw …………………………………………..$100 Full manufacturing cost per chainsaw ……………………………………………….$175 Selling price (net of marketing and distribution costs) in France …………………….$300 Suppose the United States and French tax authorities only allow transfer prices that are between the full manufacturing cost per unit of $175 and a market price of $250, based on comparable imports into France. The French import duty is charged on the price at which the product is transferred into France. Any import duty paid to the French authorities is a deductible expense for calculating French income taxes. Required 1. Calculate the after-tax operating income earned by the United States and French divisions from transferring 200,000 chainsaws (a) at full manufacturing cost per unit and (b) at market price of comparable

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