COLTRAGE CORP. was organized on January 1, 2014. The entity had pretax accounting income of P500,000 and taxable income of P800,000 for the year ended December 31, 2014. The only temporary difference is accrued product warranty costs that are expected to be paid as follows: 2015....... 100,000 2016..... 50,000 2017... 50,000 2018...... 100,000 The entity has never had any net operating losses and does not expect any in the future. The enacted income tax rates are 35% for 2014, 30% for 2015 through 2017, and 25% for 2018. On December 31, 2014, what amount should be reported as deferred tax asset?

COLTRAGE CORP. was organized on January 1, 2014. The entity had pretax accounting income of P500,000 and taxable income of P800,000 for the year ended December 31, 2014. The only temporary difference is accrued product warranty costs that are expected to be paid as follows: 2015....... 100,000 2016..... 50,000 2017... 50,000 2018...... 100,000 The entity has never had any net operating losses and does not expect any in the future. The enacted income tax rates are 35% for 2014, 30% for 2015 through 2017, and 25% for 2018. On December 31, 2014, what amount should be reported as deferred tax asset?

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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On January 1, 2021, Squirtle Company sold a piece of equipment to Charmander Company with a cost of P3,500,000 and accumulated depreciation of P500,000 in exchange for an annual 6% interest-bearing note, P3,600,000. Charmander company is required to make ten equal semi-annual payments of principal plus interest. Questions: 1. How much is the total amount that will reflect in the statement of comprehensive income for the year 2021 that is related to the above transaction? 2. What is the interest income for the year 2023? 3. How much is the total proceeds of Squirtle for the year 2024?
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Part 1XYZ Co. at the end of 2018, its first year of operations, prepared a reconciliation between pretax financial income and taxable income as follows:Pretax financial income € 750,000Estimated expenses deductible for taxes when paid 1,200,000Extra depreciation (1,350,000)Taxable income € 600,000 Estimated warranty expense of €800,000 will be deductible in 2019, €300,000 in 2020, and €100,000 in 2021. The use of the depreciable assets will result in taxable amounts of €450,000 in each of the next three years. Instructions (a) Prepare a table of future taxable and deductible amounts.(b) Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2018, assuming an income tax rate of 40% for all years.
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am.104.
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