Assume that the Kelso Company operates in an industry for which NOL carryback is allowed. The Kelso Companyhad the following operating results:O $22,800.Year20192020202125%What is the income tax refund receivable?O $24,300O $28,800.Income (loss)54,00057,000(72,000)O 23,550.Tax rate35%30%Income tax18,900first year of operations17,1000

Income tax refund is the tax amount which is paid by the taxpayer in advance and is to be received…

Answered: Assume that the Kelso Company operates…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The following balances were taken from the books of Whispering Corp. on December 31, 2025. Interest revenue Cash Sales revenue Accounts receivable Prepaid insurance Sales returns and allowances Allowance for doubtful accounts Sales discounts Land Equipment Buildings Cost of goods sold $87,500 52,500 1,391,500 151,500 21,500 151,500 8,500 46,500 101,500 201,500 141,500 622,500 Assume the total effective tax rate on all items is 20%. Accumulated depreciation-equipment $41,500 Accumulated depreciation-buildings 29,500 Notes receivable Salling expenses Accounts payable Bonds payable Administrative and general expenses Accrued liabilities Interest expense Notes payable Loss from earthquake damage Common stock Retained earnings WHISPERING CORP. Income Statement 156,500 195,500 171,500 101,500 98,500 33,500 61,500 101,500 $ 151,500 Prepare a multiple-step income statement: 100,000 shares of common stock were outstanding during the year. (Round earnings per share to 2 decimal places, e.g.…
The pretax financial income (or loss) figures for Jenny Spangler Company are as follows. 2015 $160,000 2016 250,000 2017 80,000 2018 (160,000 ) 2019 (380,000 ) 2020 120,000 2021 100,000 Pretax financial income (or loss) and taxable income (loss) were the same for all years involved. Assume a 25% tax rate for 2015 and 2016 and a 20% tax rate for the remaining years.Prepare the journal entries for the years 2017 to 2021 to record income tax expense and the effects of the net operating loss carryforwards. All income and losses relate to normal operations. (In recording the benefits of a loss carryforward, assume that no valuation account is deemed necessary.)
In 2010, Garner Grocers had taxable income of -$2,000,000. The corporate tax rate is 25%. Assume that the company takes full advantage of the Tax Code’s carry-forward provision. In 2021, Garner has taxable income of $1,000,000. What is the amount of taxes the company paid in 2021? a. $20,000 b. $8,000 c. $0 d. $90,000 e. $586,500
In 2020, Garner Grocers had taxable income of -$2,000,000. The corporate tax rate is 25%. Assume that the company takes full advantage of the Tax Code's carry-forward provision. In 2021, Garner has taxable income of $1,000,000. What is the amount of taxes the company paid in 2021? O a. $500,000 Ob. $750,000 O c. $1,500,000 O d. $0 O e. $250,000
Operating income and tax rates for Carla Vista Company's first three years of operations were as follows: 2020 2021 2022 O Income $350000 ($950000) $1630000 Amount $190000 Assuming that Carla Vista Company opts only to carryforward its 2021 NOL, what is the amount of deferred tax asset or liability that Carla Vista Company would report on its December 31, 2021 balance sheet? $285000 $237500 Enacted tax rate $190000 25% 20% 30% Deferred tax asset or liability Deferred tax liability Deferred tax asset Deferred tax liability Deferred tax asset
In 2020, Appalachian Airlines had taxable income of -$3,000,000. In 2021, the company has taxable income of $5,000,000 and its corporate tax rate is 25%. Assume that the company takes full advantage of the Tax Code's carry-forward provision. How much will the company pay in taxes in 2021? O a. $1,500,000 O b. $750,000 O c. $0 O d. $1,250,000 Oe. $500,000
Sunland Corporation reported the following results for its first three years of operation: 2020 income (before income taxes) 2021 loss (before income taxes) 2022 income (before income taxes) $360000 (3300000) O $(2310000) O $(3300000) O $0 O $(3228000) 3600000 There were no permanent or temporary differences during these three years. Assume a corporate tax rate of 20% for 2020 and 2021, and 30% for 2022. Assuming that Sunland elects to use the carryforward provision and not the carryback provision, what income (loss) is reported in 2021?
Marvel Corporation (a C-corporation) has the following operating profit for 2019 through 2021. Year 2019 2020 2021 Operating profit ($60,000) $30,000 $50,000 Assume the marginal tax rate is flat 21%. (1) Discuss the tax consequences in year 2019, 2020, and 2021, respectively. (2) Why does the tax law allow business taxpayers to carry the net operating loss (NOL)?
This is a multiple answer question. Babcock Company just completed its first year of operations and has a net operating loss for tax purposes of $100,000. Babcock expects to be profitable within the next two years. The enacted tax rate is 40%. Which of the following components are included in the journal entry to record the NOL carryforward? (Choose all that apply) A. credit taxes payable $40,000 B. debit income tax expense $40,000 C. credit income tax expense $40,000 D.debit deferred tax asset $40,000 E. credit deferred tax liability $40,000
In 2020, Garner Grocers had taxable income of -$2,000,000. The corporate tax rate is 25%. Assume that the company takes full advantage of the Tax Code's carry-forward provision. In 2021, Garner has taxable income of $1,000,000. What is the amount of taxes the company paid in 2021? a. $500,000 b. $0 c. $250,000 d. $1,500,000 e. $750,000
Tamarisk Corporation had the following tax information. Year 2018 2019 2020 Taxable Income $288,000 312,000 384,000 Tax Rate 35 % 30 30 Taxes Paid $100,800 93,600 115,200 In 2021, Tamarisk suffered a net operating loss of $460,800, which it elected to carryback. The 2021 enacted tax rate is 29%. Prepare Tamarisk's entry to record the effect of the loss carryback. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)
Blossom Corporation had the following tax information: Year Taxable Income Tax Rate Taxes Paid 2020 $389,000 31% $120,590 2021 311,000 30% 93,300 2022 398,100 30% 119,430 In 2023, Blossom suffered a net operating loss of $551,000, which it decided to carry back. The 2023 enacted tax rate is 25%. Prepare Blossom's entry to record the effect of the loss carryback. (List debit entry before credit entry. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Account Titles and Explanation Debit Credit Income Tax Receivable 165300 165300

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