Ted is an agent for Waxwing Corporation, an airliner manufacturer, and is negotiating a sale with a representative of the U.S. g
overnment and with a representative of a developing country. Waxwing has sufficient capacity to handle only one of the orders. Both orders will have the same contract price. Ted believes that if Waxwing will authorize a $500,000 payment to the representative of the foreign country, he can guarantee the sale. He is not sure that he can obtain the same result with the U.S. government. Identify the relevant tax issues for Waxwing. Discuss why they could or should influence Waxwing's decision.
The Non-deductible amount of $500,000 paid to the representative of a developing country and the qualification for a 9% deduction will influence the decision of Waxwing and they will choose to do business with the US government
Explanation:
The payment of $500,000 to the representative of a developing country in order to Guarantee sales to the country is illegal and will be considered as a bribe. and any money paid as a bribe or a kickback to an employee or representative of a country it is not deductible
secondly If waxwing goes into contract with the US government they will qualify for a 9% deduction under the Domestic production activities deduction
The Non-deductible amount of $500,000 paid to the representative of a developing country and the qualification for a 9% deduction will influence the decision of Waxwing and they will choose to do business with the US government
The input for the secondary sector comes from the primary sector. It comprises of all the raw materials that the secondary sector needs to process and produce goods. It generates money for some nations and can be considered "cash crops" because to its importance and worldwide commerce in sustaining the secondary sector, which is growing. This covers forestry, fishing, mining, and agriculture. In contrast, the tertiary sector creates services, while the secondary sector creates manufactured items. In less developed nations, the primary sector is frequently more significant than in industrialized nations.
because In the long run, real GDP tends to potential output.
Explanation:
Since actual GDP continues to increase economic output in the longer term, the seasonally adjusted annual budget balance is a better predictor of public policies ' long-term sustainability. ... Economic GDP dropped in recessions.
This means that incomes for consumers, business investment and profits for producers also fall.
The cyclically adjusted expenditure balance plays an important role in the EU budgetary framework, which still provides a better picture of fiscal policy focus.
