IF AN MNC HAS FOREIGN TAX CREDITS, HOW IS ITS DOMESTIC INCOME TAX...

78. If an MNC has foreign tax credits, how is its domestic income tax determined? a. Foreign tax credits only affect the MNC's foreign income tax, so the MNC's domestic income tax is not affected. b. Foreign tax credits are deducted from the foreign income tax owed, and then the reduced foreign income tax is combined with the MNC's domestic income tax, and that amount is paid by the MNC. c. The MNC determines its tentative domestic income tax and then deducts its allowable foreign tax credits. d. The MNC's domestic income tax is reduced by the applicable percentage of foreign income tax paid.