- This topic has 4 replies, 3 voices, and was last updated 8 years ago by
.
- Posts
hello sir , i have an issue in this question
I understand that the tax rate in gamala is 10 % lower then the home country of Tramont USA, but i dont understand the implications for this along with the lost contribution , which i cant get whats the background behind it
Secondly why is the conversion process happening in financing effects?
I couldnt get this question either, the lost contribution and all, and the tax treaty implications as well
If they lose contribution, then their taxable profits will be lower and therefore the tax payable will be lower than it would be otherwise.
Instead of showing the two effect separately the examiner has just shown the net effect – the lost contribution less the tax saving that results.With regard to showing the conversion process happening in financing effects, it would have been perfectly fine to have shown ‘above’ financing effects. The final answer would obviously have been the same.
- You must be logged in to reply to this topic.