San Carlos Corporation, a U.S. multinational, had pretax U.S. source income and foreign source income as follows:
U.S. source income
Foreign source income-Country W
Total
$ 400,000
300,000
$ 700,000
San Carlos paid $60,000 income tax to Country W. Assume San Carlos' foreign source income does not qualify as
foreign-derived intangible income. Calculate San Carlos' tax savings if it takes a foreign tax credit rather than
deducing this tax.