5. On January 30, Year 9, Edge issued $10 million bonds at a premium of $500,000. 6. On February 4, Year 8, the IRS assessed Edge an additional $400,000 for the Year 4 tax year. Edge's tax attorneys and tax accountants have stated that it is likely that the IRS will agree to a $100,000 settlement. !!! !!!!
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- Abbot Corporation reported pretax book income of $500,000. During the current year, the reserve for bad debts increased by $5,000. In addition, tax depreciation exceeded book depreciation by $40,000. Finally, Abbot received $3,000 of tax-exempt life insurance proceeds from the death of one of its officers. Abbot's current income tax expense or benefit would be:Dunn, Inc. uses the accrual method of accounting for financial reporting purposes and appropriately uses the installment method of accounting for income tax purposes. Installment income of $3,000,000 will be collected in the following years when the enacted tax rates are: Enacted Collection of Tax Rates Income 2024 $ 300,000 25% 2025 600,000 20% 2026 900,000 20% 2027 1,200,000 15% The installment income is Dunn's only temporary difference. What amount should be reported as a deferred income tax liability in Dunn's December 31, 2024 balance sheet? A) $480,000 B) $555,000 OC) $675,000 D) $750,000Lance 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, 2021, Lance has a warranty liability of $2 million and taxable income of $75 million. At December 31, 2020, Lance reported a deferred tax asset of $471,000 related to this difference in reporting warranties, its 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 2021. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.) View transaction list Journal entry worksheet > Record 2021 income taxes. Note: Enter debits before credits. Transaction General Journal Debit Credit 1 Record entry Clear entry View general journal
- 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, 2021, Lance has a warranty liability of $2 million and taxable income of $80 million. At December 31, 2020, Lance reported a deferred tax asset of $461,000 related to this difference in reporting warranties, its 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 2021.IMPORTANT, PLEASE SEE IMAGE, ANSWER CORRECTLY AND I'LL LIKE YOUR ANSWER. THANK YOU! Exercise 19-03 (Part Level Submission) Marigold Corporation began 2020 with a $39,560 balance in the Deferred Tax Liability account. At the end of 2020, the related cumulative temporary difference amounts to $301,000, and it will reverse evenly over the next 2 years. Pretax accounting income for 2020 is $451,500, the tax rate for all years is 20%, and taxable income for 2020 is $348,300.Parton owes $3 million that is due on March 5, 2021. The company borrows $2,600,000 on February 25, 2021(5-year note) and uses the proceeds to pay down the $3 million note. How much of the $3 million note is classified as long-term in the February 28, 2021 financial statements?
- D4. As of december 31, 2019, Sandy Beach had $9,500,000 in 4.5 percent serial bonds outstanding. Cash of $509,000 is the debt service fund’s only asset as of December 31, 2019, and there are no liabilities. The serial bonds pay interest semiannually on January 1 and July 1, with $500,000 in bonds being retired on each interest payment date. Resources for payment of interest are transferred from the General Fund, and the debt service fund levies property taxes in an amount sufficient to cover principal payments.The XYZ, Inc. reported $50 million of taxable income. Its federal tax rate was 21% (ignore any possible state corporation taxes). What is the company’s federal income tax bill for the year? Question 1 options: a) $11,500,000 b) $10,500,000 c) $12,100,000 d) $11,100,00012) Ehrlich Corporation prepared the following reconciliation for its first year of operations: Pretax financial income for 2021 $2,550,000 Excess depreciation expense (450,000) Taxable income $2,100,000 The temporary difference will reverse evenly over the next two years at an enacted tax rate of 30%. The enacted tax rate for 2021 is 20%. Prepare the journal entry for the income taxes for 2021
- Dunn, Inc. uses the accrual method of accounting for financial reporting purposes and appropriately uses the installment method of accounting for income tax purposes. Installment income of $3,000,000 will be collected in the following years when the enacted tax rates are: Collection of Income Enacted Tax Rates 2020 $300,000 25% 2021 600,000 20% 2022 900,000 20% 2023 1,200,000 15% The installment income is Dunn's only temporary difference. What amount should be included in the deferred income tax liability in Dunn's December 31, 2020 balance sheet? a. $480,000 b. $555,000 c. $675,000 d. $750,000J-Matt, Inc., had pretax accounting income of $331,000 and taxable income of $376,000 in 2021. The only difference between accounting and taxable income is estimated product warranty costs of $45,000 for sales in 2021. Warranty payments are expected to be in equal amounts over the next three years (2022–2024) and will be tax deductible at that time. Recent tax legislation will change the tax rate from the current 25% to 20% in 2023. Determine the amounts necessary to record J-Matt’s income taxes for 2021 and prepare the appropriate journal entry.Fox Corporation reported pretax book income of $5,250,000. During the current year, the reserve for warranties increased by $300,000. In addition, tax depreciation exceeded book depreciation by $400,000. Finally, Fox received $50,400 of tax-exempt interest from municipal bonds. Compute Fox’s current income tax expense or benefit.