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Final Memo Assignment
Big Company (your client or employer located in Charlotte) has bought all of assets of the Fog Company in
London, England. (They sometimes refer to it as the London Fog company.)
Big will operate the Fog business in London as a branch. Big will send Sue Executive to London to manage
the branch operation. Sue will arrive in London on November 15, 2007.
She expects to stay there for 2 years, except for periodic visits with relatives in the United States.
Big Company outbid a rival company in order to acquire the Fog Company assets.
The rival company is determined to acquire the Fog assets and has entered into negotiations to buy them from
Big. If the rival is successful, Big would sell the Branch assets in June, 2008 and Sue would return to the U.S.,
leaving London on June 30, 2008.
Sue will continue to earn her current salary of $20,000 per month while in London.
Big will pay all costs for a
house in London, which expected to be $100,000 per year (12 months). These estimated costs of $100,000 per
year include: rent for a house, furniture rental, utilities, cable for TV and internet, garbage pickup, etc.
You may assume that Sue will pay income taxes in England amounting to 25% of her gross salary. There will
be no British income tax on the housing allowance. You are not asked to address any issues related to the
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- Spring '08
- Godfrey,H
- Taxation in the United States, Sue, income tax return
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