_____ Pindax Owns 100% of the Outstanding Common Stock of Sindax

Multiple Choice

_____ Pindax owns 100% of the outstanding common stock of Sindax, a foreign subsidiary located in a country having a 25% income tax rate and a 5% dividend withholding tax. For 2006, Sindax reported net income of $300,000 and paid dividends of $300,000. Pindax's income tax rate is 40%. How much should Pindax record on its books in 2006 for income tax expense pertaining to Sindax's 2006 earnings?

A) $ -0-
B) $5,000
C) $15,000
D) $45,000
E) $60,000