MID SEMESTER EXAMINATION

Academic Year 2021-2022 / OCTOBER 2021

Subject : International Taxation
Lecturer : Dr. Choirul Anwar SE, MBA, MAFIS, CA, CPA
Study Program : Accounting

Instructions to Students
1. This examination consists of ...1... page(s) and ..4... question(s)
2. Time allowed for this examination is 1 week project hour (s)
3. Sanctions will be given to those students who are not following the examination rules.
4. All answers to be written in answer sheet provided. The number to the corresponding question
must be written correctly.
5. Students are to use proper English and are required to write neatly and clearly.
6. This is a closed book (an open book) examination.
7. Students are (not) allowed to use calculator.
8. Students are (not) allowed to use any dictionary.
9. Students need to turn-off any communication devices.
10. Students are not allowed to use electronic devices or borrow any equipment, etc. from fellow
students, nor can they communicate with each other while the examination is going on.

Questions:

1. Taxes are one of the most significant costs incurred by business enterprises. Taxes can
be an important factor in making decisions related to foreign operations including: - in
which country should an operation be located,
- what should its legal form be, and
- should it be financed with debt or equity.
Give the example of such enterprises completely along with its operations that is run as
statements mentioned above!

2. The two major types of taxes imposed on profits earned by companies with foreign
operations are income taxes and withholding taxes.
Explain and give some examples of them !

3. Tax jurisdiction over income is an important issue. Two factors determine which country
will tax which income:
a) whether a country uses a worldwide or territorial approach to taxation, and
b) whether a country taxes on the basis of source of income, residence of the
taxpayer, and/or citizenship of the taxpayer.
Explain those two statements above and give reasonable example!
4. There are two types of objectives to consider in determining international transfer prices:
a) performance evaluation and
b) cost minimization.
Give concrete example aling with the calculation of both statements a and b above !

---------- Good Luck ----------