Below is the Retained Earnings account for the year 2020 for Concord Corp. Retained earnings, January 1, 2020 Add: Gain on sale of investments (net of tax) Net income Refund on litigation with government, related to the year 2017 (net of tax) Recognition of income earned in 2019, but omitted from income statement in that year (net of tax) Deduct: Loss on discontinued operations (net of tax) Write-off of goodwill (net of tax) Cumulative effect on income of prior years in changing from LIFO to FIFO inventory valuation in 2020 (net of tax) Cash dividends declared Retained earnings, December 31, 2020 $43,510 86,810 23,910 CONCORD CORP. Retained Earnings Statement 27,710 37,310 62,310 25,510 34,310 $259,910 181,940 441,850 159,440 $282,410 (a) Prepare a corrected retained earnings statement. Concord Corp. normally sells investments of the type mentioned above. FIFC inventory was used in 2020 to compute net income. (List items that increase adjusted retained earnings first)

Below is the Retained Earnings account for the year 2020 for Concord Corp. Retained earnings, January 1, 2020 Add: Gain on sale of investments (net of tax) Net income Refund on litigation with government, related to the year 2017 (net of tax) Recognition of income earned in 2019, but omitted from income statement in that year (net of tax) Deduct: Loss on discontinued operations (net of tax) Write-off of goodwill (net of tax) Cumulative effect on income of prior years in changing from LIFO to FIFO inventory valuation in 2020 (net of tax) Cash dividends declared Retained earnings, December 31, 2020 $43,510 86,810 23,910 CONCORD CORP. Retained Earnings Statement 27,710 37,310 62,310 25,510 34,310 $259,910 181,940 441,850 159,440 $282,410 (a) Prepare a corrected retained earnings statement. Concord Corp. normally sells investments of the type mentioned above. FIFC inventory was used in 2020 to compute net income. (List items that increase adjusted retained earnings first)

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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Novak Inc. reports the following pretax income (loss) for both book and tax purposes. Pretax Year Income (Loss) Tax Rate 2018 20 % 2019 20 % 2020 25 % 2021 25 % $123,000 98,000 (105,000) 110,000 The tax rates listed were all enacted by the beginning of 2018.
Prepare the bottom portion of Sheridan's 2021 income statement, beginning with “Income from continuing operations before income taxes." (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Sheridan Corporation Income Statement (Partial) For the Year Ended December 31, 2021 ncome from Continuing Operations before Income Taxes 1164000 ncome Tax Expense urrent Deferred ncome from Continuing Operations Gain on Discontinued Operations 195000 Less v: -39000 i 156000 let Income / (Loss) $ %24 %24
Prepare the bottom portion of Sheridan's 2021 income statement, beginning with “Income from continuing operations before income taxes." (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Sheridan Corporation Income Statement (Partial) For the Year Ended December 31, 2021 ncome from Continuing Operations before Income Taxes 1164000 ncome Tax Expense Current $ Deferred 189000 ncome from Continuing Operations Gain on Discontinued Operations 195000 Less v: -39000 i 156000 let Income / (Loss) $ %24 %24 > >
Accounting income or loss for Aberdeen Corporation, following IFRS, is below: Year Accounting income/(loss) Tax rate percent Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 $160,000 250,000 80,000 (160,000) (380,000) 130,000 145,000 30 30 25 25 25 25 25 Assume that there were no permanent or temporary differences between accounting and taxable income. Required Prepare the tax-related journal entries for Year 3 to Year 7. Aberdeen Corporation believes that it will be able to use any loss carryforward in future years. Aberdeen Corporation will apply the available carryback provisions to the earliest years first. Include your calculations.
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The following facts relate to Sandhill Corporation. 1. 2. 3. 4. 5. 6. 7. 8. (a) Deferred tax liability, January 1, 2025, $28,400. Deferred tax asset, January 1, 2025, $0. Taxable income for 2025, $114,950. Pretax financial income for 2025, $221,000. Cumulative temporary difference at December 31, 2025, giving rise to future taxable amounts, $290,400. Cumulative temporary difference at December 31, 2025, giving rise to future deductible amounts, $42,350. Tax rate for all years, 20%. The company is expected to operate profitably in the future. Compute income taxes payable for 2025. Prepare the journal entry to record income tax expense, deferred income taxes and income tax payable for 2025
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Assume the following facts for Munoz Company in 2019. Munoz reported pretax financial income of $800,000. In addition, Munoz reported the following differences between its pretax financial income and taxable income:• Interest income of $80,000 was received during 2019 from an investment in municipal bonds. This income is exempt for tax purposes.• Rent income of $40,000 was collected in 2018 and included for tax purposes during that year. For financial statement purposes, it will be reported as earned equally in 2019 and 2020.• An asset with a 5-year life was purchased during 2019; straight-line depreciation for book purposes was $40,000. MACRS depreciation expense for 2019 was $100,000.• Warranty expense of $20,000 was recognized on the 2019 income statement, while $5,000 was recognized for tax purposes. (Assume a 1-year warranty contract.)The balance of the Deferred Tax Asset account (debit) at January 1, 2019, was $16,000 as a result of the rent income temporary difference. The tax…
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Prepare the bottom portion of Sheridan's 2021 income statement, beginning with "Income from continuing operations before income taxes." (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Sheridan Corporation Income Statement (Partial) For the Year Ended December 31, 2021 icome from Continuing Operations before Income Taxes 1164000 ncome Tax Expense Current Deferred 189000 ncome from Continuing Operations Gain on Discontinued Operations 195000 Less -39000 156000 let Income / (Loss) %24 %24 > >
The following information was taken from the records of Blue Inc. for the year 2025: Income tax applicable to income from continuing operations $228,140, income tax applicable to loss on discontinued operations $31,110, and unrealized holding gain on available-for- sale debt securities (net of tax) $18,300. Gain on sale of equipment Loss on discontinued operations Administrative expenses Rent revenue Loss on write-down of inventory Revenues Sales Revenue Rent Revenue Shares outstanding during 2025 were 100,000. Total Revenues Expenses Cost of Goods Sold Selling Expenses Administrative Expenses Prepare a single-step income statement (with respect to items in Income from operations). (Round earnings per share to 2 decimal places, e.g. 1.48. Enter other revenue and gains before other expenses and losses) Total Expenses Income from Operations Other Revenues and Gains Gain on Sale of Equipment Other Expenses and Losses Inventory Loss Income before Income Tax Income Tax Income from…