Carla reported the following pretax financial income (loss) for the years 2015-2019. 2015 2016 2017 2018 2019 $235,000 343,000 98,000 (511,000) 176,000 ) Pretax financial income (loss) and taxable income (loss) were the same for all years involved. The enacted tax rate was 34% for 2015 and 2016, and 40% for 2017-2019. Assume the carryback provision is used first for net operating losses A.) Prepare the journal entries for the years 2017-2019 to record income tax expense, income taxes payable (refundable), and the tax effects of the loss carryback and loss carryforward, assuming that based on the weight of available evidence, it is more likely than not that one-fifth of the benefits of the

Carla reported the following pretax financial income (loss) for the years 2015-2019. 2015 2016 2017 2018 2019 $235,000 343,000 98,000 (511,000) 176,000 ) Pretax financial income (loss) and taxable income (loss) were the same for all years involved. The enacted tax rate was 34% for 2015 and 2016, and 40% for 2017-2019. Assume the carryback provision is used first for net operating losses A.) Prepare the journal entries for the years 2017-2019 to record income tax expense, income taxes payable (refundable), and the tax effects of the loss carryback and loss carryforward, assuming that based on the weight of available evidence, it is more likely than not that one-fifth of the benefits of the

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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Keshara has the following net § 1231 results for each of the years shown: Tax Year Net § 1231 Loss Net § 1231 Gain 2016 $18,000 2017 33,000 2018 42,000 2019 $41,000 2020 30,000 2021 41,000 What would be the nature of the net gains in 2020 and 2021? If an amount is zero, enter "0". Amount Amount Total Treated as Treated as Net § 1231 Ordinary Long-Term Gain Income Capital Gain 2020 30,000 2021 41,000
At the beginning of 2021, Pitman Co. had pretax financial income of $1,200,000. Additionally, there was a timing difference of $300,000 due to an accounts receivable that will not be collected until the following year. The tax rate us 30%. A. Calculate the total taxable income for 2021. B. Calculate Income tax expense, income tax payable, and the deferred amount for 2021, and create the journal entry.
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Grouper Company reports pretax financial income of $68,400 for 2020. The following items cause taxable income to be different than pretax financial income. 1. Depreciation on the tax return is greater than depreciation on the income statement by $17,000. 2. Rent collected on the tax return is greater than rent recognized on the income statement by $21,000. 3. Fines for pollution appear as an expense of $10,300 on the income statement. Grouper’s tax rate is 30% for all years, and the company expects to report taxable income in all future years. There are no deferred taxes at the beginning of 2020. (a) Compute taxable income and income taxes payable for 2020. Taxable income $enter a dollar amount Income taxes payable $enter a dollar amount (b) Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2020. (Credit account titles are…
Teal Company reports pretax financial income of $72,600 for 2020. The following items cause taxable income to be different than pretax financial income. 1. Depreciation on the tax return is greater than depreciation on the income statement by $17,200. 2. Rent collected on the tax return is greater than rent recognized on the income statement by $20,300. 3. Fines for pollution appear as an expense of $9,900 on the income statement. Teal’s tax rate is 30% for all years, and the company expects to report taxable income in all future years. There are no deferred taxes at the beginning of 2020. (a) Compute taxable income and income taxes payable for 2020. Taxable income $enter a dollar amount Income taxes payable $enter a dollar amount
Sherrod, Inc., reported pretax accounting income of $70 million for 2021. The following information relates to differences between pretax accounting income and taxable income: Income from installment sales of properties included in pretax accounting income in 2021 exceeded that reported for tax purposes by $4 million. The installment receivable account at year-end 2021 had a balance of $6 million (representing portions of 2020 and 2021 installment sales), expected to be collected equally in 2022 and 2023. Sherrod was assessed a penalty of $1 million by the Environmental Protection Agency for violation of a federal law in 2021. The fine is to be paid in equal amounts in 2021 and 2022. Sherrod rents its operating facilities but owns one asset acquired in 2020 at a cost of $60 million. Depreciation is reported by the straight-line method, assuming a four-year useful life. On the tax return, deductions for depreciation will be more than straight-line depreciation the first two years but…
For the current year, LNS corporation reported the following taxable income at the end of its first, second, and third quarters. Quarter-End Cumulative Taxable Income First $ 1,850,000 Second 2,520,000 Third 3,600,000 What are LNS’s minimum first, second, third, and fourth quarter estimated tax payments, using the annualized income method?
In 2020, Sunland Corporation had pretax financial income of $185,000 and taxable income of $117,000. The difference is due to the use of different depreciation methods for tax and accounting purposes. The effective tax rate is 20%.Compute the amount to be reported as income taxes payable at December 31, 2020. Income taxes payable at December 31, 2020 $enter the amount to be reported as income taxes payable at December 31, 2017
Lee Company’s current income taxes payable related toits taxable income for 2017 is $320,000. In addition, Lee’sdeferred tax liability increased $40,000 and its deferredtax asset increased $10,000 during 2017. What is Lee’sincome tax expense for 2017?
Sheridan Company reported the following results for the year ended December 31, 2020, its first year of operations: Income (per books before income taxes) $3343000 Taxable income 4466000 The disparity between book income and taxable income is attributable to a temporary difference, which will reverse in 2021. What should Sheridan record as a net deferred tax asset or liability for the year ended December 31, 2020, assuming that the enacted tax rates in effect are 35% in 2020 and 30% in 2021? O $393050 deferred tax liability $336900 deferred tax liability $393050 deferred tax asset $336900 deferred tax asset
N1. Account
Sunland Company reports pretax financial income of $72,600 for 2025. The following items cause taxable income to be different than pretax financial income. 2. Depreciation on the tax return is greater than depreciation on the income statement by $17,200. Rent collected on the tax return is greater than rent recognized on the income-statement by $20,300. 3. Fines for pollution appear as an expense of $9,900 on the income statement. Sunland's tax rate is 30% for all years, and the company expects to report taxable income in all future years. There are no deferred taxes at the beginning of 2025. (a) X Your answer is incorrect. Compute taxable income and income taxes payable for 2025. Taxable income $ 92500 Income taxes payable $ 27750