18 5 points Skipped eBook TGW, a calendar year corporation, reported $4,076,000 net income before tax on its financial statements prepared in accordance with GAAP. The corporation's records reveal the following information: • TGW's depreciation expense per books was $462,000, and its MACRS depreciation deduction was $384,900. • TGW capitalized $692,000 indirect expenses to manufactured inventory for book purposes and $830,000 indirect expenses to manufactured inventory for tax purposes. • TGW's cost of manufactured goods sold was $2,571,000 for book purposes and $2,666,000 for tax purposes. • Four years ago, TGW capitalized $2,334,000 goodwill when it purchased a competitor's business. This year, TGW's auditors required the corporation to write the goodwill down to $1,570,000 and record a $764,000 goodwill impairment expense. Required: Compute TGW's taxable income. Note: Do not round intermediate calculations. Amounts to be deducted should be indicated with a minus sign. Print References Mc Graw Hill TGW's net book income before tax Adjustments: Depreciation Indirect inventory costs Cost of goods sold Book goodwill impairment expense Tax amortization of goodwill TGW's taxable income Amount < Prev 18 of 20 Next > Check my work
18 5 points Skipped eBook TGW, a calendar year corporation, reported $4,076,000 net income before tax on its financial statements prepared in accordance with GAAP. The corporation's records reveal the following information: • TGW's depreciation expense per books was $462,000, and its MACRS depreciation deduction was $384,900. • TGW capitalized $692,000 indirect expenses to manufactured inventory for book purposes and $830,000 indirect expenses to manufactured inventory for tax purposes. • TGW's cost of manufactured goods sold was $2,571,000 for book purposes and $2,666,000 for tax purposes. • Four years ago, TGW capitalized $2,334,000 goodwill when it purchased a competitor's business. This year, TGW's auditors required the corporation to write the goodwill down to $1,570,000 and record a $764,000 goodwill impairment expense. Required: Compute TGW's taxable income. Note: Do not round intermediate calculations. Amounts to be deducted should be indicated with a minus sign. Print References Mc Graw Hill TGW's net book income before tax Adjustments: Depreciation Indirect inventory costs Cost of goods sold Book goodwill impairment expense Tax amortization of goodwill TGW's taxable income Amount < Prev 18 of 20 Next > Check my work
SWFT Essntl Tax Individ/Bus Entities 2020
23rd Edition
ISBN:9780357391266
Author:Nellen
Publisher:Nellen
Chapter5: Business Deductions
Section: Chapter Questions
Problem 2BCRQ
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Transcribed Image Text:18
5
points
Skipped
eBook
TGW, a calendar year corporation, reported $4,076,000 net income before tax on its financial statements prepared in accordance with
GAAP. The corporation's records reveal the following information:
• TGW's depreciation expense per books was $462,000, and its MACRS depreciation deduction was $384,900.
• TGW capitalized $692,000 indirect expenses to manufactured inventory for book purposes and $830,000 indirect expenses to
manufactured inventory for tax purposes.
• TGW's cost of manufactured goods sold was $2,571,000 for book purposes and $2,666,000 for tax purposes.
• Four years ago, TGW capitalized $2,334,000 goodwill when it purchased a competitor's business. This year, TGW's auditors
required the corporation to write the goodwill down to $1,570,000 and record a $764,000 goodwill impairment expense.
Required:
Compute TGW's taxable income.
Note: Do not round intermediate calculations. Amounts to be deducted should be indicated with a minus sign.
Print
References
Mc
Graw
Hill
TGW's net book income before tax
Adjustments:
Depreciation
Indirect inventory costs
Cost of goods sold
Book goodwill impairment expense
Tax amortization of goodwill
TGW's taxable income
Amount
< Prev
18 of 20
Next >
Check my work
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