Jovar Inc., a U.S. multinational, began operations this year. Jovar had pretax U.S. source income and foreign source income as follows: U.S. source income$600,000 Foreign source income-Country O 100,000 Total$700,000 Jovar paid $50,000 income tax to Country O. Compute Jovar's U.S. tax liability if it takes the foreign tax credit.
A. $204,000
B. $147,000
C. $97,000
D. $126,000
Answer: D
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What will be an ideal response?
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