a. At December 31, 2024, temporary differences existed between the financial statement book values and the tax bases of the following: Buildings and equipment (net of accumulated depreciation) Prepaid insurance Liability-loss contingency Book Value $134 57 32 ($ in millions) Tax Basis $97 0 0 Future Taxable (Deductible) Amount $37 57 (32) b. No temporary differences existed at the beginning of 2024. c. Pretax accounting income was $207 million and taxable income was $145 million for the year ended December 31, 2024. The tax rate is 25%. Required: 1. Complete the following table given below and prepare the appropriate journal entry to record income taxes for 2024. 2. What is the 2024 net income?
a. At December 31, 2024, temporary differences existed between the financial statement book values and the tax bases of the following: Buildings and equipment (net of accumulated depreciation) Prepaid insurance Liability-loss contingency Book Value $134 57 32 ($ in millions) Tax Basis $97 0 0 Future Taxable (Deductible) Amount $37 57 (32) b. No temporary differences existed at the beginning of 2024. c. Pretax accounting income was $207 million and taxable income was $145 million for the year ended December 31, 2024. The tax rate is 25%. Required: 1. Complete the following table given below and prepare the appropriate journal entry to record income taxes for 2024. 2. What is the 2024 net income?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
rmn.2
Transcribed Image Text:The information that follows pertains to Richards Refrigeration, Incorporated:
a. At December 31, 2024, temporary differences existed between the financial statement book values and the tax bases
of the following:
Buildings and equipment (net of accumulated depreciation)
Prepaid insurance
Liability-loss contingency
Complete this question by entering your answers in the tabs below.
Required 1
Calculation
Book
Value
General
Journal
$ 134
57
32
Required 2
($ in millions)
b. No temporary differences existed at the beginning of 2024.
c. Pretax accounting income was $207 million and taxable income was $145 million for the year ended December 31,
2024. The tax rate is 25%.
Tax
Basis
$ 97
0
0
Required:
1. Complete the following table given below and prepare the appropriate journal entry to record income taxes for 2024.
2. What is the 2024 net income?
Future Taxable
(Deductible)
Amount
$ 37
57
(32)
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