9. Stone Co. began operations in 20x1 and reported P225,000 in income before income taxes for the year. Stone's 20x1 tax depreciation exceeded its book depreciation by P25,000. Stone had nondeductible book expenses of P10,000 related to permanent differences. Stone's tax rate for 20x1 was 40%, and the enacted rate for years after 20x1 is 35%. In its December 31, 20x1, balance sheet, what amount of deferred income tax liability should Stone report?

9. Stone Co. began operations in 20x1 and reported P225,000 in income before income taxes for the year. Stone's 20x1 tax depreciation exceeded its book depreciation by P25,000. Stone had nondeductible book expenses of P10,000 related to permanent differences. Stone's tax rate for 20x1 was 40%, and the enacted rate for years after 20x1 is 35%. In its December 31, 20x1, balance sheet, what amount of deferred income tax liability should Stone report?

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter14: Taxes On The Financial Statements

Section: Chapter Questions

Problem 4BCRQ

See similar textbooks

Related questions

Q: Use EMBG's adjusted trial balance to prepare EMBG's balance sheet for the current year-end. EMBG…

A: Definition: Balance sheet: To Know the financial position of the business balance sheet is prepared.…

Q: Can you explain the answer without excel please? Thanks.

A: Cost of Car is $52000 Interest rate is 6% Time period is 5 years Monthly Interest rate "rate" is…

Q: How do I calculate FIFO? Please provide examples so I can see HOW the answer comes out.

A: Here in this case we need to understand the FIFO method. We first needs to understand that, there is…

Q: I need it solved with the data in my question. Thanks

A: With the probability based case, the expected NPV is the weighted average of the NPV of different…

Q: Use EMBG's adjusted trial balance to prepare the company's income statement. EMBG CORPORATION…

A: As posted multiple independent questions we are answering only first question kindly repost the…

Q: Instructions Identify each item by letter and list the items in columnar form, using the headings…

A: Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: I need help understanding step by step how to slove this

A: Introduction: Direct material: Direct material refers to the material used by the company in…

Q: can you show formulas used to solve this problem?

A: The concept of the time value of money determines that the worth of money gets depreciated over a…

Q: Could you please provide the solution without using the excel?

A: concept. Formula. 1. F = S * ert where , F= future price. S= spot price r= interest rate t= time…

Q: What is an important advantage gained by using a spreadsheet?

A: Spreadsheet is an important tool for recording information in the form of rows and columns into…

Q: 1. Complete the Adjustments columns using the following year-end adjustments information. a./b.…

A: Solution: Adjusting Entries are the journal entries that are made at the end of a given accounting…

Q: Explain how the E-R diagrams is used to prepare database tables. Also, include explanation of…

A: ER diagram stands for "Entity Relationship", which can be defined as a type of flowchart that is a…

Q: What are the advantages and disadvantages of accessing online primary sources?

A: Primary sources are the proof of history, original records or objects created by participants or…

Q: Give example of the relationship between a Human Resource Information System and MIS.

A: Human Resource Information System (HRIS) refers to the system of collecting, recording, classifying,…

Q: Hi! What are the threats and recommendations for this flowchart? Thank you!

A: Production planning includes making of plans of production and manufacturing in order to utilize all…

Q: Inventory Costing Methods-Periodic Method The following data are for the Portet Corporation, which…

A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…

Q: omparing relevance and reliability, which information quality is most important? Support your answer…

A: Reliability of information relies on appropriate information being provided to managers so that they…

Question

Please put all of the necessary information and computations for better understanding. Thanks ?

9. Stone Co. began operations in 20x1 and reported P225,000 in income before
income taxes for the year. Stone's 20x1 tax depreciation exceeded its book depreciation by
P25,000. Stone had nondeductible book expenses of P10,000 related to permanent
differences. Stone's tax rate for 20x1 was 40%, and the enacted rate for years after 20x1 is
35%.
In its December 31, 20x1, balance sheet, what amount of deferred income tax liability should
Stone report?

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

The Bookbinder Company had 500,000 cumulative operating losses prior to the beginning of last year. It had 100,000 in pre-tax earnings last year before using the past operating losses and has 300,000 in the current year before using any past operating losses. It projects 350,000 pre-tax earnings next year. a. How much taxable income was there last year? How much, if any, cumulative losses remained at the end of the last year? b. What is the taxable income in the current year? How much, if any, cumulative losses remain at the end of the current year? c. What is the projected taxable income for next year? How much, if any, cumulative losses are projected to remain at the end of next year?
9. Stone Co. began operations in 20x1 and reported P225,000 in income before income taxes for the year. Stone’s 20x1 tax depreciation exceeded its book depreciation by P25,000. Stone had nondeductible book expenses of P10,000 related to permanent differences. Stone’s tax rate for 20x1 was 40%, and the enacted rate for years after 20x1 is 35%. In its December 31, 20x1, balance sheet, what amount of deferred income tax liability should Stone report?
Stone Company reported pre-tax book income of $700,000 in 20X1, the first year of operation. The tax depreciation exceeded the book depreciation by $90,000. The tax rate for 20X1 and all future years was 21%. What amount of deferred tax liability should Stone report in its December 31, 20X1, balance sheet? Select one: a. $6,300 b. $14,000 c. $18,900 d. $3,500
Lin Ltd. reported the following: Earnings (loss) Depreciation (assets have a cost of $360,000) CCA Non-deductible expenses Tax rate Taxable income Accounting earnings Permanent difference Accounting income subject to tax Temporary difference 1. What is the amount of the taxable income or loss in each year? (Negative amounts and deductible amounts should be indicated by a minus sign.) Taxable income 20X7 20x7 (first year of operations) $98,000 $45,000 $60,000 $18,000 20x8 30% 2008 $(166,000) $ 45,000 $ 70,000 $18,000 30%
Please put all of the necessary information and computations for better understanding. Thanks ?
Chandler Corporation reported pre-tax book income of $1,900,000. Tax depreciation exceeded book depreciation by $600,000. During the year the Company capitalized $250,000 into ending inventory under §263A. Capitalized inventory costs of $150,000 in beginning inventory were deducted as part of cost of goods sold on the tax return. Assuming a tax rate of 21%, compute the company’s taxes payable or refundable.
For its first year of operations, Tringali Corporation's reconciliation of pretax accounting income to taxable income is as follows: Pretax accounting income $ 300,000 Permanent difference (15,000 ) 285,000 Temporary difference-depreciation (20,000 ) Taxable income $ 265,000 Tringali's tax rate is 40%. Assume that no estimated taxes have been paid. What should Tringali report as income tax payable for its first year of operations? a.$8,000 b.$120,000 c.$106,000 d.$114,000
For its first year of operations, Tringali Corporation's reconciliation of pretax accounting income to taxable income is as follows: Pretax accounting income $ 300,000 Permanent difference (15,000 ) 285,000 Temporary difference-depreciation (20,000 ) Taxable income $265,000. Tringali's tax rate is 25%. Assume that no estimated taxes have been paid. What should Tringali report as its income tax expense for its first year of operations? 1. A) $75,000. 2. B) $66,250. 3. C) $71,250 4. D) $5,000. O A O B O C O D
3. War Eagle, Inc. reported the following for 20X3:a. taxable income of $2,000,000 b. paid federal income taxes of $420,000.c. a net operating loss carryover of $1 00,000 d. Section 179 expensed of $300,000 last yeare. Actual business interest expense for book was $2 0,000, but for tax, they could only deduct $15,000 because of the limitation on business interest expense.f. Increase in LIFO recapture of $12,000g. Tax Exempt Income of $1,000h. Operating expenses for tax were $1 00,000, which included $10,000 of MACRS depreciation for tax. Depreciation under the alternative ( E&P) depreciation method was $15,000. Compute the company's current E&P for 20X3.
46. Akoto Corporation reported pretax book income of $2,000,000. Tax depreciation exceeded book depreciation by $500,000. During the year, the company capitalized $250,000 into ending inventory under §263A. Capitalized inventory costs of $150,000 in beginning inventory were deducted as part of cost of goods sold on the tax return. Compute the company's taxes payable or refundable.
At the beginning of 20x5, Rundle Ltd. reported a deferred tax liabilty of $300,000. The net book value of the capital assets was $2,600,000, while UCC was $1,600,000. In 20x5, depreciation was $400,000, while CCA was $625,000. The tax rate changed in 20x5 to be 35 %. What is the adjustment required to the deferred taxes?
Parker Company identifies depreciation as the only difference for future taxable amounts. In Year 1, its depreciation for financial reporting purposes is $9,000 and $10,500 for income tax reporting purposes. Parker has an income tax rate of 35%. Assume that Parker’s taxable income for Year 1 is $150,000. Required: Prepare the journal entry to record Parker’s income tax expense.