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- Question 11-pen sion Henry Company had Pretax financial income of $850,000 at the end of 2020. Estimate d warranty expense of €500,000 will be deductible in 2021, €300,000 in 2022, and€150,000 in 2023. The use of the depreciable assets will result in taxable amounts of €350,000 in each of the next three years. Required (a) Prepare a table of future taxable and deductible amounts. (b) - Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2020, assuming an income tax rate of 35% for all years.am. 85.15. ABC began operating on January 1, 2020. At the end of the first year of operation, ABC reported P7,000,000 income before income tax on its statement of financial performance and P2,500,000 taxable income on its tax return. Analysis of the P4,500,000 revealed that P3,500,000 was a difference without future tax consequence, and the other P1,000,000 was a temporary difference related to prepaid rent which is expected to reverse in 2022. At the end of 2021, the accumulated temporary tax liability difference related to future years is P1, 500,000. The P500,000 increase is due to an accrued income taxable only when actual collection is made, which is expected on the year 2022. The current and enacted future tax rate is 30%. Assume that the income before tax in 2021 and 2022 are P6,500,000 and P7,200,000, respectively. There is no permanent difference during these years. Following the rules applicable in accounting for deferred taxes, compute the deferred tax liability as of the end of…
- *attached is the problem REQUIRED: What is the lease liability on Dec. 31, 2020? What is the lease liability to be reported as non-current on Dec 31, 2020? What is the interest expense for 2020? What is the depreciation for 2020?What is the interest expense for the calendar year 2022? (round off answer to the nearest WHOLE NUMBER) On March 31, 2021, SIX Company as lessee signed a ten-year non-cancelable lease for an equipment stipulating annual payments of P375,250. The first payment was made on March 31, 2021 and P375,250 annually on each March 31 for the next nine years. The present value on March 31, 2021 of the ten lease payments over the lease term using the rate implicit in the lease which SIX knows to be 12% was P3,175,500. The March 31, 2021 present value of the lease payments using SIX's incremental borrowing rate of 14% was P2,850,125. Ownership of the property remains with the lessor at expiration of the lease. There is no purchase option. The leased property has an estimated economic life of 12 years.Ef 60.
- E 16-7 Temporary difference; future deductible amounts; taxable income given LO16-3 Lance Lawn Services reports warranty expense by estimating the amount that eventually will be paid to satisfy warranties on its product sales. For tax purposes, the expense is deducted when the warranty work is completed. At December 31, 2024, Lance has a warranty liability of $2 million and taxable income of $75 million. At December 31, 2023, Lance reported a deferred tax asset of $435,000 related to this difference in reporting warranties; it's only temporary difference. The enacted tax rate is 25% each year. Required: Prepare the appropriate journal entry to record Lance's income tax provision for 2024.The prepaid rent is P120,000 good for one year starting November 30, 2020. The balance sheet date is December 31, 2020. The prepayment was recorded under asset method. The correct rent expense for the given period would be:Hypothetical Corporation incurred the following expenses: 2019 2020Research and Development 619,000 703,000 The new product will be available for sale July 1, 2021. Calculate the deduction for R&D expenses for 2019, 2020, and 2021 under the following independent assumptions:a. Armando Corporation elects to expense the R&D expenses. b. Armando Corporation elects to amortize the R&D expenses over 60 months.