1.) XQP corporation expensed $50,000 of bad debts during the year. The activity in the allowance for doubtful accounts was$70,000Beginning BalanceBad Debt Accrued for the YearBad Debts Written OffEnding Balance$50,000$35,000$85,000What is the BOOK-TO-TAX difference of XQP Corp for bad debts?O A.SOO B.$15,000 UnfavorableOC. $35,000 UnfavorableO D. $50,000 UnfavorableO E. $85,000 Unfavorable

Book to tax difference is the temporary difference created on the accounting books due to…

1.) XQP corporation expensed $50,000 of bad debts during the year. The activity in the allowance for doubtful accounts was Beginning Balance Bad Debt Accrued for the Year Bad Debts Written Off Ending Balance What is the BOOK-TO-TAX difference of XQP Corp for bad debts? O A. $0 O B. $15,000 Unfavorable OC. $35,000 Unfavorable O D. $50,000 Unfavorable O E. $85,000 Unfavorable $70,000 $50,000 $35,000 $85,000

1.) XQP corporation expensed $50,000 of bad debts during the year. The activity in the allowance for doubtful accounts was Beginning Balance Bad Debt Accrued for the Year Bad Debts Written Off Ending Balance What is the BOOK-TO-TAX difference of XQP Corp for bad debts? O A. $0 O B. $15,000 Unfavorable OC. $35,000 Unfavorable O D. $50,000 Unfavorable O E. $85,000 Unfavorable $70,000 $50,000 $35,000 $85,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.

Question

1.) XQP corporation expensed $50,000 of bad debts during the year. The activity in the allowance for doubtful accounts was
$70,000
Beginning Balance
Bad Debt Accrued for the Year
Bad Debts Written Off
Ending Balance
$50,000
$35,000
$85,000
What is the BOOK-TO-TAX difference of XQP Corp for bad debts?
O A.SO
O B.$15,000 Unfavorable
OC. $35,000 Unfavorable
O D. $50,000 Unfavorable
O E. $85,000 Unfavorable

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Flyer Company has provided the following information prior to any year-end bad debt adjustment: • Cash sales, $150,000• Credit sales, $450,000• Selling and administrative expenses, $110,000• Sales returns and allowances, $30,000• Gross profit, $290,000• Accounts receivable, $110,000• Sales discounts, $14,000• Allowance for doubtful accounts credit balance, $1,200Flyer estimates bad debt expense assuming that 1.5% of credit sales have historically been uncollectible. How much is Flyer's bad debt expense? Group of answer choices A)$7,950 b)$6,750 C)$5,550 D)$9,000 E)None of the above
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Michael Company uses the percent-of-sales method for estimating bad debts expense. The company's bad debt expense normally 4% of net credit sales which were $410,000 for the year. During the year $2,700 was written off. The Allowance for Bad Debts account had a beginning debit balance of $1,000. What is the net realizable value of receivables if Accounts Receivable has a balance of $300,000? ⒸA. $410,000 B. $287.300 OC. $279,900 D. $283,600
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Required information [The following information applies to the questions displayed below.] At year-end December 31, Chan Company estimates its bad debts as 1.00% of its annual credit sales of $608,000. Chan records its bad debts expense for that estimate. On the following February 1, Chan decides that the $304 account of P. Park is uncollectible and writes it off as a bad debt. On June 5, Park unexpectedly pays the amount previously written off. Prepare Chan's journal entries to record the transactions of December 31, February 1, and June 5. View transaction list
Required information [The following information applies to the questions displayed below.) At year-end December 31, Chan Company estimates its bad debts as 0.70% of its annual credit sales of $729,000. Chan records its bad debts expense for that estimate. On the following February 1, Chan decides that the $365 account of P. Park is uncollectible and writes it off as a bad debt. On June 5, Park unexpectedly pays the amount previously written off. Prepare Chan's journal entries to record the transactions of December 31, February 1, and June 5.
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At the end of its first year of operations, a company establishes an allowance for future uncollectible accounts for $5,600. At what amount would bad debt expense be reported in the current year's income statement? Multiple Choice O $6,400. $5,600. $4,800. $800.
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