Tanks and Toilets Inc

Multiple Choice

Tanks and Toilets Inc. is a Canada-based MNC that manufacturers stainless steel bathroomfixtures. of $100,000 before foreign taxes. All before-tax earnings are to be paid to the parent as interest. The foreign taxes include an income tax rate of 30 percent and an interest withholding tax of 15 percent. The firm's marginal tax rate in Canada is 45 percent. The amount of tax paid to the Canadian government would be

A) $70,000.
B) $45,000.
C) $30,000.
D) $38,250.